Last December, the Government announced a major reform of stamp duty which abolished the "slab" style system and made it far more proportional and fair. As a result, it was predicted that huge numbers of homebuyers would benefit, and by the looks of things, it's had the desired effect!
Figures from conveyancing provider My Home Move show that UK homeowners have collectively saved £1.9bn in stamp duty since the reforms were implemented, with an average saving of over £1,500 per purchase. That's a definite boost!
This kind of saving could go a long way to funding the overall purchase, be it through having more money to put towards the deposit, having enough left over to cover mortgage fees, or even through having extra cash to furnish the new place, with the vast majority of buyers being able to benefit.
Indeed, it's only those purchasing a home priced more than £937,500 who would have seen their stamp duty costs increase, so for most people, the changes will have been largely welcomed. In fact, in a recent poll of estate agents, 87% said that the changes have had a positive impact on the market, with the financial gain being clear.
"Homebuyers have benefited from the significant stamp duty overhaul during the last 12 months with each buyer saving an average of £1,500, a much needed boost for those struggling to get on the housing ladder as prices have risen by 6% during the last year," said Doug Crawford, CEO of My Home Move.
He added that the big winners have been first-time buyers and second steppers who have "really struggled with price hikes due to a lack of housing stock", and while cheaper stamp duty bills won't have fixed all the problems facing these buyers, they've certainly helped by making it easier to save for a deposit.
"The old 'slab' system was ripe for reform as it was creating a stranglehold over the market, especially where property prices neared the stamp duty thresholds, and in particular around the £250,000 mark. Thanks to the reforms, people are now able to sell their homes for a truer value."
However, he pointed out that there are those who have lost out from the changes, as is the case with any reforms, with "a small minority of buyers who are looking for luxury homes or expensive London properties" now facing stamp duty costs of up to 12% of the purchase price.
Nonetheless, the fact that those lower down the property ladder – and arguably in less of a position to be able to cover stamp duty costs – have benefited will ensure that the reforms are deemed a success, leaving many with more money with which to fund their purchase.
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