Chancellor Rishi Sunak has confirmed long-rumoured plans for a stamp duty holiday in his summer statement. The changes, to be implemented in the autumn budget, will affect house sales of up to £500,000 – and will apply even if your house purchase isn't your first.
This is a temporary move designed to boost the flagging housing market, which is currently suffering from restricted mortgage access for those with low deposits and a reduced supply due to seller wariness in the wake of coronavirus.
The measure will be in place until 31 March 2021 and will be especially helpful to buyers in the South East, where the average property price on any home is closer to the £500,000 threshold. Sunak has said that the average stamp duty bill will fall by £4,500, with the measure coming into immediate effect.
And, unlike other financial 'holidays' introduced by the governments as part of its coronavirus relief effort, such as the much-used mortgage holidays, the stamp duty holiday is not simply a delay in payment, but a genuine cancellation.
The announcement follows months of growing pressure on the government to introduce a stamp duty holiday in order to help a stagnating housing market – and the ever-dwindling pool of people able to afford their own home. Policy Manager at RICS, Tamara Hooper, shared her thoughts on the stamp duty holiday:
'RICS called for a temporary stamp duty holiday, as a vital short term initiative to help confidence in the home buying and selling process and help those who may want to move but are cautious in doing so, and may be waiting to see what the future holds. Temporarily removing stamp duty for all homes under the cap, not just first home buyers, demonstrates Government’s confidence within the sector and the economy and a desire to get the country moving again.
'However, property can’t be given a free ride, and Government must ensure that they continue to engage with industry and monitor the situation to ensure this initiative continues to stimulate housing market activity and reassess the measure when the economic need for stimulation eases.'