Stamp duty cut until 2021
On Wednesday 8th July Rishi Sunak announced that a stamp duty “holiday” will come into effect immediately. This will make certain properties on the market exempt from the tax. The chancellor unveiled an emergency mini budget that included the removal of stamp duty on homes worth up to £500,000. The plan is to kickstart the stalled housing market amid the coronavirus crisis. This could have a huge impact on those looking to buy homes on the lower end of the market. Sunak said the cut will last until 31 March 2021, with the average tax fee falling by £4,500.
Who is eligible?
The current stamp duty land tax will be altered so that the threshold is set between £300,000 and £500,000. These changes will enable buyers in the lower end of the housing market to avoid paying tax altogether. For example, if a first-time buyer purchases a property for £500,000, the new system could allow them to save £10,000 on stamp duty. Property website Zoopla said the holiday would mean an extra 73% of sales would be exempt from the basic level of tax. That quite a saving for a lot of people!
How will this affect the rental market?
Any significant saving on stamp duty would encourage buy-to-let investors to return to the rental market. This in turn would help meet the rising demand for rental homes and drive transaction levels. In addition to this, more renters will be looking to make the most of the tax holiday and jump onto the housing market.
One thing is for sure, the stamp duty holiday will most defiantly get he housing market moving again. It’s a welcomed relief to many and if you’re looking to buy this could well be the time to take the leap!
If you’re looking for a rental property in the Norwich and Gt Yarmouth areas take a look at our current properties.