A lack of new homes for sale in the UK boosted prices again last month even as the housing market slowed following a partial withdrawal of a pandemic emergency tax break for property purchases.
On 1st July 2020, the government announced a year-long cut to help buyers whose finances were affected by Covid. Until June 2021, homebuyers didn’t have to pay stamp duty on the first £500,000 of a purchase price. This meant a saving of up to £15,000.
The government later extended the tax holiday from 1st July until 30th September this year. During this period, home buyers didn’t have to pay stamp duty on the first £250,000:
£0-£250,000 = 0%
£250,001-£925,000 = 5%
£925,001-£1,500,000 = 10%
£1,500,000+ = 12%
From 1st October 2021, rates will return to pre-Covid levels. That means the point you start paying stamp duty will be £125,001:
£0-£125,000 = 0%
£125,001-£250,000 = 2%
£250,001-£925,000 = 5%
£925,001-£1,500,000 = 10%
£1,500,001+ = 12%
There is still some uncertainty around the economy and what impact unemployment may have on the market and, of course, Brexit buzz has re-emerged due to heightening fuel concerns. But for now, the property market is a very busy and vibrant place to be. ~ Ray Smith, Senior Partner, Watsons
The Royal Institution of Chartered Surveyors (RICS) gauge of new buyer enquiries slipped in August to its lowest level since January, as did its measure of agreed sales but with demand still far more than supply-driven by people seeking bigger homes as they aim to work remotely or change their lifestyle alongside other family members.
Most surveyors polled by the RICS, including Watsons – reported rising house prices and a positive market. Ray Smith, Senior Partner for Watsons commented “While momentum has eased, relative to an exceptionally strong period earlier in the year, there are still many factors likely to drive a solid market growth going forward. There is still some uncertainty around the economy and what impact unemployment may have on the market and, of course, Brexit buzz has re-emerged due to heightening fuel concerns. But for now, the property market is a very busy and vibrant place to be and there are no signs of this changing in the immediate future for all our Chartered Surveyors across the country.”
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