Stamp Duty Holiday
The stamp duty holiday was introduced in July of 2020 with the aim of giving the property market a boost and aiding those who’s finances were affected during the initial lockdown. In March 2021 during the announcement of the new spring budget it was announced by Rishi Sunak that not only would there be an extension to the stamp duty holiday, originally meant to end that month, but there would be a staggered return to normality. As we approach June, many are wondering, what does this mean for them?
What is the stamp duty holiday?
The stamp duty holiday means that instead of paying 2% stamp duty on anything above £125,000 and 5% on anything above £250,000 as is usually the case, home buyers only have to pay 5% on anything exceeding £500,000. Landlords and second home purchasers do benefit from this as well, however they do still have to pay the additional 3% of stamp duty originally in place.
This has meant a saving of up to £15,000 for some buyers.
A Staggered Return
In a bid to avoid a sudden surge of issues with sales that are currently in hand when the deadline approaches, the government introduced the idea of a staggered return. This would mean the nil rate is halved after June 30, meaning stamp duty is paid on anything above £250,000. This will last until the end of September, with the return of the normal rates after October 1st.
What other help for first time buyers is the government providing?
Anyone buying a home with a value of less than £600,000, that is not a buy to let, second home or in some cases a new build, will have access to a new government guarantee scheme meaning high street lenders will now be offering mortgages to people with deposits of just 5%.
When the stamp duty holiday does begin to return to normal at the end of June, from July first time buyers will still benefit from not having to pay stamp duty on homes under £300,000, as has been the case since August 2017.