Increase for Landlords and Multiple Homeowners
In the Autumn Statement, Chancellor George Osborne announced
a substantial increase in Stamp Duty on the purchase of additional residential
properties. That will therefore apply to
situations such as purchase of a property to let out or of a second home.
From April 2016 any such properties will face an additional
3% charge, on top of the existing levy.
This means the new stamp duty structure in England and Wales
will look like this:
Stamp duty is applied only to the portion of the property
value falling in that band, similar to income tax.
So while a sole home valued at £300,000 would incur
£5,000 stamp duty, if that same £300,000 were an additional Buy to Let property
for example, the stamp duty charge would increase to £14,000 from April.
Clearly that’s a massive increase in costs so we can
expect a flurry of activity as potential “additional property buyers” seek to
beat the April deadline. Anyone thinking
about becoming a new landlord or adding to an existing portfolio is bound to be
keen to complete the purchase before the new higher charges come into effect.
That could therefore intensify competition for suitable
property in the next few months. From
April, however, aspiring first time buyers may find life a little easier as
investor numbers ease back.
Guild Mortgage Service, Provided by London
& Country Mortgages
OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR
Most buy-to-let mortgages are not
regulated by the FCA