The Chancellor has announced that from 8 July, the stamp duty threshold will be raised temporarily to £500,000 in a bid to boost the housing market.
Sunak has revealed plans to raise the stamp duty threshold from £125,000 to £500,000 in England and Northern Ireland. This means that 89% of transactions will no longer be subject to stamp duty, which starts immediately, and lasts until 31 March 2021.
Luke Gidney, MD of HOP said “This is a big change and an indication that the Government is serious about stimulating the housing market after it was effectively brought to a halt by Coronavirus”.
“This new stamp duty holiday is excellent news for those buying a new home, as well as Estate Agents and everyone else who provides services to those moving home such as removal companies, decorators, furnishing suppliers and even garden centres”
The Treasury said nearly nine out of ten people getting on or moving up the property ladder will pay no stamp duty at all, which is fantastic news for the housing market in Leeds.
The Chancellor’s new measures mean that buyers will only start to pay stamp duty on the amount that they pay for the property above £500,000, which means that 9 in 10 property buyers will now benefit from the new stamp duty holiday.
Earlier this year there were calls for a stamp duty cut to help revive the property market as lockdown eases. Physical restrictions during lockdown had a substantial impact on the market, with housing transactions down by 50% this year, and in turn halving stamp duty receipts to £4bn.
Luke Gidney said: “Both the Lettings and Sales Market in Leeds has picked up significantly since the start of June, however this new stamp duty holiday will be a major boost for activity and give buyers and sellers additional confidence that now is actually a very good time to continue with their moving plans”
“We are sure to see a flood of buyers coming into the market in Leeds. People who had put back their moving plans, will undoubtedly bring forward their move, to make the most of a buoyant market during the stamp duty holiday”
“We hope that Sellers who had previously put back their plans due to the pandemic and economic uncertainty also come to the market, to avoid huge price increases if demand outweighs supply”.
Sunak’s move will result in significant savings in particular for some buyers, and although the move is designed to help home movers, it will also save Landlords tax too.
Landlords will save on the base rate SDLT, but will still pay the additional homes SDLT which is an additional 3%.
The Government will not only give buyers an effective tax break, but those in supporting industries will also benefit, as the housing market is such an important cog in the wider economy. Movers will need to organise finances, utilities, cleaners, as well as furnishings, gardens and building work, which supports other sectors too.
We are in full support of the Chancellors move and wish everyone the best during this period.
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