While some corners were waiting with baited breath as the Chancellor ran through his most recent Budget, for many, Stamp Duty was the announcement that never was.
The fact that anyone now buying a property for £500,000 or more through a company structure will have to pay a 15% charge will of course generate some additional income for the country’s coffers, but for the everyday buyer, questions over the future of Stamp Duty remain.
Since the Budget it has emerged that the tax raised from property and property transactions is expected to at least double over the next five years according to estimates from the Office for Budget Responsibility (OBR). With construction increasing and more transactions taking place, the OBR anticipate between the 2012-13 year and 2018-19 Stamp Duty revenues will almost treble, from £6.9bn to £18.1bn.
With this in mind, it’s easy to appreciate the constraints the government would have in trying to make any changes to the way that Stamp Duty is currently structured.
However, we know first-hand the difference that any Stamp Duty relief can make. The tax is a major consideration for buyers, and particularly those taking their first steps onto the ladder. It can determine the types of properties people can afford to buy and the length of time that they have to save before being able to move. It’s one of the most hotly debated topics when discussing the measures that can be taken to support the market.
As many people reading this blog will know, Halifax is once again running a campaign where it will cover the Stamp Duty cost of first time buyers who are purchasing up to £250,000. We’re doing it because it makes a real difference to buyers who have an endless list of other things that they could be using the money for at such an expensive time.
Whether or not there are any for changes for Stamp Duty planned remains to be seen. In the meantime it will be down to the industry to help ensure buyers fully appreciate and prepare for what can be a very significant cost.
Ian Wilson is head of Halifax Intermediaries