Gary Curtis, our sales manager in Canterbury, writes,
"On the 11th of March, Budget Day, all eyes will be on you, our new Chancellor of the Exchequer, the Rt Hon Rishi Sunak MP. The year has started well in the property market, but what could you do to really get things moving?
English taxpayers will be especially interested in what, if any, changes there are to Stamp Duty. The taxation for Scottish and Welsh homebuyers is slightly different with Land and Buildings Transaction Tax and Land Transaction Tax respectively.
Stamp Duty is payable by those buying property over £125,000 – although first-time buyers aren’t liable for stamp duty on homes up to £300,000.
With the average house price in England standing at £134,742, this stamp duty affects a great many homebuyers. So much so, that over the 2018/19 tax period, the government collected almost £12 billion in stamp duty revenue. A cynic might think, small wonder the government is actively persuading the population to buy homes.
But the problem with high stamp duty is that it does the opposite. It deters people from moving – preventing empty nesters in larger homes from downsizing and selling to families who need them. It stalls the market and prevents a natural flow of discretionary buying and selling.
A previous Tory plan was to overhaul stamp duty by raising the threshold from £125,000 to £500,000 and lower the top rate – which applies above £1.5m – from 12% to 7%. But this was dropped from the last election manifesto. Could you resuscitate this policy, Chancellor? It would greatly help the housing market if you did.
Although the introduction of a mansion tax looks unlikely, overseas buyers are concerned that you will be tempted to introduce a 3% stamp duty surcharge. With a growing number of expats returning to the UK at the end of the Brexit transition period, this tax would add to the home buyer burden especially if it is imposed on top of stamp duty already payable and the 3% surcharge on second homes and buy-to-let properties.
Your predecessors in Number 11 were not notably successful in stimulating the housing market. Now that this government seems keen to build infrastructure, perhaps you will be inclined to treat a buoyant property market, good housing – and flood defences - with the same importance the population does.
Gary Curtis is the Sales Manager in our Canterbury office. To discuss your property journey in buying, selling, letting or renting homes in Kent, please call 01227 454111.