Written by: Edward Feather on 4th October 2022
Saving money on property purchases became easier in September, as the Government brought in new rules around stamp duty. On September 23, chancellor Kwasi Kwarteng announced a permanent stamp duty cut in England and Northern Ireland, as part of the Government’s mini-budget.
It’s been almost a year since the 2021 Stamp Duty holiday ended, and the new rules are hoped to give the UK economy a boost and help first-time buyers get onto the property ladder. So what are the new stamp duty thresholds, and how will they affect you? Whether you’re looking to sell your property or buy a new home, we’ll explain the stamp duty changes here.
Stamp Duty, or Stamp Duty Land Tax (SDLT) is a tax paid by buyers of a residential property or land in England and Northern Ireland. In Scotland, buyers pay Land and Buildings Transaction Tax (LBTT), and in Wales buyers pay Land Transaction Tax (LTT). The amount of stamp duty you’ll pay depends on the price of the home you’re buying, and your circumstances.
If you’re a first time buyer in England or Northern Ireland, you won’t pay any Stamp Duty Tax on purchases under £425,000 under the new rules. For purchases between £425,001 and £625,000, you’ll pay 5% of the property’s value. Previously, first-time buyers were exempt up to £300,000.
If it isn’t your first property purchase, you won’t pay Stamp Duty Tax on homes purchased under £250,000 - a rise from the previous £125,000. Properties bought for more than £250,000 will be taxed at 5% of the home’s value.
Stamp duty increases to 10% of the property’s price for purchases over £925,000, and 12% for anything over £1.5 million.
If you’re buying an additional property, such as a second home, you’ll pay an extra 3% in stamp duty on top of the standard rates. This applies to all purchases above £40,000.
The threshold increase for first-time buyers will help more people get onto the housing ladder, and if you buy your first home under £425,000, you won’t have to pay any stamp duty tax at all. With current concerns about the cost of living crisis, rising energy bills, interest rates and soaring food prices across the UK, the new stamp duty thresholds are a welcomed change to help buyers to reduce the cost of moving.
The choice of properties you’re able to buy could also improve. More sellers will likely decide to put their homes on the market, to take advantage of the increasing number of eligible buyers.
If you’re considering selling your home, the changes to the Stamp Duty rules will certainly benefit you. The cuts will help more people to save money on their property purchases, making it possible to find multiple potential buyers for your home.
As a homebuyer, online property auctions are a fantastic way to find your next home. At Pugh & Co, we make the process quick and simple - and you don’t even need to leave the comfort of your home! Browse our auction lots, register as a bidder, and the whole process can be completed on your laptop, tablet or mobile. Buying a property via an online auction is much faster than the traditional estate agency process, and there’s no risk of a seller pulling out of the sale. Once it’s yours, it’s yours. What’s more, all bids are 100% transparent, so you can be certain the amount you pay is in line with what other buyers think the property is worth.
Online property auctions are an excellent way to sell a property, too, especially if you’re hoping for a speedy sale. Sale completions can take on average around 3 months via estate agencies, but auctions are often completed within just one month. If your property sells, contracts are exchanged there and then. Our Pugh & Co team will guide you through the process, recommending a guide and reserve price to ensure you receive an amount you’d accept for your home. As more buyers look to make a property purchase, take advantage of increased numbers of bidders by listing your home for sale via auction.
To find out more about buying your next home with Pugh, view our Online Buying Guide here.
If you’re thinking of selling your home, contact us for a free appraisal of your property today.
Written by: Edward Feather on 4th October 2022
Edward is an experienced property auctioneer with over 15 years' property auction experience and considerable knowledge of the North West property market.
Edward joined Pugh & Co in September 2018 from SDL Auctions in Chester. He was also a Director at the Cheshire and North Wales franchise of the Auction House business, based at estate agent Humphreys in Chester, before its acquisition by SDL in 2016.
