Last week, confirmation of an immediate stamp duty cut look to mean delayed sales can finally be complete. However, the immediate talk following has been focused on the reduction and the Government’s mini-budget and how it should have gone further.
Described as a ‘growth plan’, Chancellor Kwasi Kwarteng increased at what point stamp duty is charged on property purchases from £125,000 to £250,000 for home movers. The first-time buyer threshold will increase from £300,000 to £425,000 and can be used on purchases worth up to £625,000.
Sigh of Relief
Naturally, this much-rumoured stamp duty cut confirmation comes as a huge sigh of relief for agents and conveyancers when introduced last week, covering concerns that buyers about to complete transactions had last week.
Within an hour of the announcement, online traffic for homes jumped by 10%. The rise of the threshold to £250,000 has now exempted a third of all homes currently listed for sale in England, including those looking to buy property in Stockport. This is up from 7% when the threshold was £125,000.
This has now resulted in two-thirds of homes across the nation now being fully exempt from the property tax for first-time buyers in the UK.
The Treasury revealed that doubling the nil-rate band enables up to 29,000 more people to move home within the year, with the increased threshold for first-time buyers giving them even more options. First-time buyers purchasing a property at £400,000 would save £5,000 on Stamp Duty. the saving increases to £11,250 for first-time buyers on a property at £600,000.
The savings are smaller for homeowners at £2,500 for a £400,000 or £600,000 purchase.
These cuts are proving great for first-time buyers but have left other groups such as downsizers feeling a bit left out in the cold. Whilst the rebalancing of the thresholds for which Stamp Duty is paid for first-time buyers is long overdue, the landscape for downsizers and last-time movers also could have been reviewed to release the latter part of the market.
This would unblock the standstill for second-steppers and first-time buyers instead of causing stagnation for buyers with nothing to move to.
Still on the Slate
Whilst the implementation of an immediate and permanent reduction means that existing transactions will suffer no unruly delays and the benefits can be felt early, the shortage of supply, raising interest rates and the cost of a five-year fixed-mortgage tripling over the last year will still play a large hand for those looking to buy property in Stockport and exploring avenues on how to sell a house.
Contact the team at Joules estate agents Stockport today for updated information on available property in the northwest.