There will be no extension to the existing stamp duty relief for first-time buyers, which ends on 24th March 2012. The temporary concession leaves first-time buyers free from the 1% stamp duty on homes costing under £250,000 and the threshold will revert to its previous level of £125,000. In yesterday’s Autumn Statement, Chancellor of the [...]
Stamp Duty
Landlords see Budget reforms on stamp duty and REITs
Landlords were promised some relief in yesterday’s Budget with Chancellor of the Exchequer, George Osborne, announcing that the rate of stamp duty land tax on purchases of multiple residential properties will, in future, be determined by the mean value of the dwellings purchased (subject to a minimum rate of 1% ), rather than their aggregate [...]
Homebuyer demand weakens
The latest Property Tracker survey from the Building Societies’ Association (BSA) suggests that demand for property purchase may remain weak. The research indicates that 41% of people think that it would currently be a good time to buy, down from 43% in December, while 29% of respondents disagreed that it would be good to buy [...]
Stamp duty and land use hamper UK housing market
Having researched global housing markets, the Organisation for Economic Co-operation and Development (OECD) is claiming that badly-designed housing policies played an important role in triggering the recent economic and financial crisis.
The UK is among nine OECD countries showing huge increases in real housing prices (over 90%) between 1980 and 2008, with the rise reflecting income [...]
NAEA: Success of Stamp Duty Campaign a major victory for first time buyers
THE National Association of Estate Agents (NAEA) today welcomed as a major victory Alistair Darling’s decision to raise the threshold of stamp duty land tax for two years.
The NAEA has long campaigned for a major rethink on stamp duty – which it believes to be a tax on aspiration. Today in the final Budget before the election, Mr Darling listened and raised the threshold to £250,000 from midnight tonight.
Peter Bolton King, chief executive of the NAEA, said: “For thousands of first time buyers the dream of getting onto the property ladder was slipping out of reach.
“This announcement has added a new rung to the property ladder, one within reach of thousands of young families.
“We have long argued that stamp duty is a tax on aspiration that smothered the natural demand of the market. We still believe that more reform is needed and there is more work to be done, but this is a good first step – a major victory for first time buyers.”
The NAEA has for years called for a major reform of stamp duty land tax, beginning with the threshold being raised. Most recently in the run up to this Budget the association led a coalition of property organisations in calling for reform, under the banner of the 1808 campaign. More information on the 1808 campaign can be found at http://www.nfopp.co.uk/1808/
ENDS
Latest Bank mortgage lending figures may point to slower January – Council of Mortgage Lenders
The latest Bank of England mortgage data published today confirms the likelihood that there may have been a “bunching” of house purchase transactions in December to beat the stamp duty concession deadline.The gross lending total of £13.4 bn in December 2009 was in line with the CML’s estimate (£13.5 bn) and seems to confirm the CML’s view that much activity was “rushed through” to beat the stamp duty deadline. Gross lending totalled £143.5 bn in 2009.
Net lending remains up from the near stagnation in the middle of the year. For 2009 as a whole net lending totalled £11.5 bn. This was the lowest level on record (back to 1987), but higher than the CML forecast of £8 bn. It was largely driven by the relative strength of house purchase activity, which picked up over the latter part of the year, and weak levels of repayments. The CML sees little if any evidence that households, in aggregate, are using low interest rates to pay down mortgage debt more quickly.
CML economist Paul Samter said:
“These figures confirm that the mortgage market ended 2009 in much better shape than it started, but it still looks like a slow haul back to meaningful levels of activity. It should be no surprise if January and February this year appear particularly slow, if we are correct in our view that many buyers rushed to beat the stamp duty concession deadline in December.”
Notes to editors
1. The December lending data is available from the Bank of England website.
- Contact details
- Name: Sue Anderson
- Tel: 020 7438 8924
- Email: sue.anderson@cml.org.uk
- Name: Bernard Clarke
- Tel: 020 7438 8923
- Email: bernard.clarke@cml.org.uk
- Name: Jayne Chichester
- Tel: 020 7438 8922
- Email: jayne.chichester@cml.org.uk
Effects Of The End Of The Stamp Duty Holiday – Decision Homebuyers Report
London, England (Jan 11, 2010) – Decision Homebuyers, one of the UK’s most trusted and flexible home buying specialists, comment on the impending end of the stamp duty holiday and the effects it will have on the current housing market conditions.
Surveyors in the West Midlands, East Midlands, Wales and Scotland predict that the end of the holiday will have a “detrimental effect” in areas that are yet to see a recovery from the recession, and widely expect to see a drop in market activity when the threshold reverts back to its previous ways. The temporary stamp duty holiday was implemented in September 2008 and will finish at the end of the year.
The 1% tax will be reintroduced for properties sold over £125,000 compared with the £175,000 currently in operation, with The Royal Institution of Chartered Surveyors calling for the tax to be restructured. The Council of Mortgage Lenders calculates that 132,500 houses that were bought funded with a mortgage had escaped paying stamp duty in the past year.
“This is one of those situations where we will have to wait and see what the long term affects are to the housing market, but there can be no doubt that the stamp duty holiday has been a huge help to various regions in the UK,” says Laurence Smith of Decision Homebuyers. “People looking to sell a house quick or who are looking to buy a property are now working under different market conditions, and will have to cater their budgets accordingly as a result.”
To find out more about Decision Homebuyers and their services:
Please call 08456 341 456
or visit: http://www.decisionhomebuyers.co.uk/
About Decision Homebuyers:
Established in 2006 and specialising in fast property purchase, Decision Homebuyers are experts in their field. Decision Homebuyers can buy your house fast and guarantee to make cash offers on all types of residential and commercial property, no matter what the condition.
Stamp Duty Reduction on Cayman Islands Property
STAMP DUTY REDUCED BY A THIRD FOR FOREIGN INVESTORS BUYING IN THE SEVEN MILE BEACH AND GEORGE TOWN AREAS The Financial Secretary of the Cayman Islands has announced that there will be a temporary stamp duty reduction as part of an incentive package to investors to encourage activity within the cayman islands property market and maintain Cayman’s position as one of the world’s most desirable off shore property investment locations. Buyers will save substantial amounts on property purchases from April 1st 2009, when stamp duty will be reduced to 5% for a period of six months. The represents a significant 2.5% reduction from the usual 7.5% payable on purchases in the popular Seven Mile Beach and George Town areas.
There are no income taxes, annual property taxes, and inheritance or capital gains taxes in the Cayman Islands so unfortunately these cannot be reduced any further. However the Financial Secretary has simultaneously announced reductions in the import duty rates for building materials to help stimulate the local cayman property industry. The Cayman Islands have positioned themselves as the ultimate Caribbean island offering residents and visitors fabulous beaches, a safe and relaxed atmosphere with world class infrastructure and the highest standard of living in the region. Their economical and social stability have buffered the islands from any cayman property price fluctuations over the years and instead have shown gradual and steady appreciation in value, unlike the major markets in the world.
for more details: www.irg.ky
Press Release Contact Details:
P.O. Box 2390GT, Grand Cayman, KY1-1105 Cayman Islands Phone: 345-623-1111
Stamp Duty – Change demanded by property experts
Industry heavyweights have added their support to the 1808 Coalition, set up by the National Association of Estate Agents (NAEA) and the Association of Residential Lettings Agents (ARLA) to campaign for the Government to modernise Stamp Duty.
1808 Coalition partners are:
• Association of Mortgage Intermediaries (AMI)
• Association of Residential Lettings Agents (ARLA)
• Building Societies Association (BSA)
• Council of Mortgage Lenders (CML)
• Home Builders Federation (HBF)
• National Association of Estate Agents (NAEA)
• National Landlords Association (NLA)
Peter Bolton-King, Chief Executive of the NAEA, said: “The Coalition believes that Stamp Duty is an anachronistic tax which, in its current form, is preventing a recovery in the housing sector – it limits market flexibility, creates regional inequality and its slab structure unfairly distorts the housing market. With the Pre Budget Report due soon, now is the time for the Government to take action.”
The current Stamp Duty “holiday” for properties lower than £175.000 is due to expire at the start of 2010 but in a recent survey by the NAEA, 91 per cent of estate agents surveyed felt that it should be extended. 86 per cent of those surveyed felt that the tax is unfair.
Ian Potter, Operations Manager of ARLA said: “Not only does Stamp Duty prevent those aspiring to own a home from doing so, it also impacts the whole property chain. For ARLA members, this means having to pay Stamp Duty on the bulk price of a portfolio, when individual buy-to-let investors pay a lower rate on the single unit price.”
Robert Sinclair, Director of the AMI, said: “It is rare that the breadth of our industry comes together with such consensus on an issue. But the current Stamp Duty regime is distorting the market to such an extent that we feel compelled to speak out. The Association of Mortgage Intermediaries is fully committed to supporting this industry campaign to reform the regime. We implore the Government to not only listen but, to act in support of our request for change to this damaging tax.”
John Stewart, HBF’s Director of Economic Affairs, said: “It is imperative that the first signs of market stabilisation that have emerged in recent months, and which have allowed home builders to begin tentatively opening new sites and expanding output and employment, are nurtured. The Government’s stimulus measures for housing, including the raised stamp duty threshold, have played a significant part in this stabilisation and it is vital that they are not removed at this still fragile stage, either in total or in part.”
Adrian Coles, Director General, BSA, said: “The current Stamp Duty system in the UK is archaic and in desperate need of reform and modernisation. A fairer and transparent system is needed that doesn’t discriminate against young and first time home buyers, and promotes an effective housing market.”
Michael Coogan, Director General, CML, said: “We urge the government to announce a comprehensive and long-overdue review of Stamp Duty. Reform is needed of a tax that distorts the housing market.”
David Salusbury, Chairman, NLA, said: “Stamp Duty Land Tax is a pernicious tax which has failed to keep pace with house price appreciation. It creates an unbalanced housing market and discourages investment in housing. Reform is needed now.”
Anyone wishing to register comments on the campaign, or on Stamp Duty, should visit: http://www.nfopp.co.uk/1808
Stamp Duty return could have detrimental effect on regional housing market recovery – RICS
A return to the previous bands for stamp duty, when the current holiday is due to end on the 31st December 2009, could have a detrimental effect on the recovery of the housing market in regions that are already lagging behind, according to the latest research from RICS.
More surveyors in the West and East Midlands, Wales and Scotland believe that they will see a drop in activity in 2010 following the end of the stamp duty holiday for properties priced between £125k and £175k at the end of the year. Tellingly more surveyors in Wales and the East Midlands were still seeing price falls rather than rises in the last housing market survey. Meanwhile in the West Midlands, only 3 percent more surveyors saw prices rising in October.
Overall, however, the majority of Chartered Surveyors are not expecting the end of the stamp duty holiday to have a distorting effect on the housing market despite the benefit it has provided first-time buyers. Unsurprisingly it is those working in London and the South East who overwhelmingly agree that it is not forcing more houses onto the market now, and will not lead to a drop in activity once the old system is re-introduced. However, this is more a reflection on the fact that the holiday has had limited impact in these regions as the average house price is well above that of the stamp duty threshold.
Similarly in the North, where the average price is well below the threshold at £116,051, there is less concern about the impact of the end of the stamp duty holiday. However the regions that are most concerned about the impact are those whose average prices sit well within the margins that are directly affected by the holiday. These are the East Midlands (£133,973), the West Midlands (£142,969), Wales (£134,690) and Scotland (£140,175).
At the time of its introduction, we did question how great an impact this policy would have and judging by the fact that only surveyors in certain parts of the country are particularly concerned about the ending of the holiday, it could be said that some areas of the UK hardly even noticed the change.
“However the additional transaction cost is still a worry to many, particularly first-time buyers, and is a threat to the market in the areas of the country that are still seeing a weak price environment. A return to the status quo will be of benefit to no one, and as such RICS believes that rather than simply reverting back to the old structure for Stamp Duty, the imminent change provides an opportunity for the Government to introduce a wholesale restructuring of the tax. Specifically RICS favours moving from the current slab structure to a marginal system with no homebuyer paying anything on the first £150,000 of their new home.”
Simon Rubinsohn, RICS chief economist
The additional questions asked in the RICS October Housing market Survey were:
- Is the planned ending of the Stamp Duty holiday on properties priced between £125K and £175K contributing to the higher level of activity in the housing market?
- Do you expect this decision to lead to a drop in activity in the early part of 2010?
Further reading:
RICS has suggested the referenced change to Stamp Duty Land Tax as part of its Pre-Budget Report submission to the Treasury. The full submission is available at http://www.rics.org/externalaffairs
