This week, Rishi Sunak announced a £30billion rescue plan to help boost Britain’s fragile economy as it recovers from the impact of Covid-19. The support included a bonus for job retention, VAT cuts and discounts for eating out.
Another key initiative that we were delighted to see announced was stamp duty relief. Homebuyers are now exempt from tax for the first £500,000 of a property’s price – saving an average of £4,500. It is effective immediately and will be valid until March 2021.
Here’s what our clients had to say about the changes to stamp duty and what impact it will have on the property market…
Lynda Clark, CEO of First Time Buyer Group:
“The proposed changes to stamp duty will unquestionably be warmly welcomed by first time buyers – especially those with families looking for more space in their first home. The knock on effect will also be helpful to first time buyers – as homeowners may now take the opportunity to make a move into a bigger home, therefore freeing up more starter homes for purchase.
“We know that young people in particular are increasingly likely to suffer as a result of economic hardship, and so the removal of an additional tax when buying a home will prove to be a lifeline.
“While first time buyers are already exempt from paying the tax on properties worth up to £500k in London and £300k in the rest of the country, a high proportion of those getting onto the property ladder still have to pay some form of stamp duty. During economically challenging times and as saving becomes harder, the cost of stamp duty may prohibit a move and could result in many more buyers being left out in the dark and unable to invest in their future.
“The stamp duty changes, while temporary, will have long lasting effects and will encourage buyers to go ahead with their purchase – and in turn, the property market can make a more steady recovery.”
“Timing is of the essence here though and any doubt in these plans, or delay until Autumn, could lead to buyers putting off their purchases until later in the year – which could actually do more harm than good.”
Becky Munday, founder of Munday’s estate agents:
“We welcome changes made by the chancellor to stamp duty, this will certainly be a lifeline to the industry as buyers will be further incentivised (the interest rate cut earlier in the year was well-received) to buy, and to buy now. Likewise, recently hikes in stamp duty has been detrimental to stock, as buyers who are asset rich but cash poor have been unable to move due to the high costs associated.”
Lynne Smith, Sales and Marketing Director at Fernham Homes:
“A stamp-duty holiday will help so many people, including smaller housebuilders like us, who are helping to increase supply of housing in the South East so we welcome the Chancellor’s announcement. Saving for a deposit and then stamp duty costs are the biggest barriers for people getting on to the property ladder and this will aid so many people’s plans to buying their own home.”
Dean Markall, Sales and Marketing Director at Martin Grant Homes:
“Since yesterday’s stamp duty announcement, we have seen a large amount of calls and enquiries for each of our developments in the South East, alongside a number of appointments on site today, and scheduled for the weekend. Even prior to yesterday’s announcement, we have had a strong level of reservations this month, with 11 reservations taking place across our sites since 1st July – 7 of these being at our Buckton Fields development in Northampton. All appointment slots at Buckton Fields are also filled over the next few days, following yesterday’s announcement.
“We have seen the market surge in recent weeks since we re-opened our sites, and the Chancellor’s stamp duty announcement will be an added incentive for an already pent up demand from purchasers. Our enquiry levels across all of our sites has now bounced back to the strong figures we enjoyed at the start of the year in January/February, demonstrating a healthy demand for new homes from buyers.
“The stamp duty changes will be a great support for many buyers, who will now be encouraged to move as there will be no additional tax to pay. It will make a difference of up to £15,000 on a home purchase of up to £500,000 and therefore we welcome the changes, which will propel the property market forward and offer a much-needed lifeline to the housing sector. These changes have been implemented quickly and responsibly by the Chancellor, and buyers can now move ahead with their purchase without any uncertainty.”
Santhosh Gowda, Chairman, Strawberry Star Group:
“The stamp duty holiday is a well-thought out move considering the prevailing circumstances, which have impacted the housing market. The announcement is timely, and will help all types of house buyers.”
“For house builders, a strengthened sales pipeline will encourage future investment in new homes, following the government’s previous announcement to clear hurdles around planning applications.
“We have seen an instant reaction, many of our buyers called us immediately to see how their liability had reduced in light of the announcement. Likewise, we have seen a flurry of new activity from first time buyers and at our Bronze development, we have had buyers wanting to speed up the completion process along with offers placed at Greenview Court. We expect the good news to keep coming and we are more confident moving forward.”
Kush Rawal, Director of Residential Investment, Metropolitan Thames Valley Housing:
“We welcome the Chancellor’s stamp duty holiday, which makes shared ownership homes an even more attractive option for people looking to own their own home. Removing stamp duty from almost all initial share purchases means that key workers will be able to buy a shared ownership home with as little as two months of rent as their deposit.”
There’s no doubt that this week’s announcements will have a positive impact in the short term, and with so much uncertainty at this time it’s great to see the government showing commitment to helping those that have been impacted.
We look forward to watching the impact of these changes on the property market and seeing how things unfold in the coming months…