Good News for First Time Buyers in Colchester
Published at: 30/11/2017
There was welcome news in this year's Autumn Budget 2017 when Chancellor Philip Hammond announced the immediate scraping of stamp duty for first-time buyers on the first £300,000 of any home costing up to £500,000.
This means that first-time buyers purchasing a home for less than £300,000 will pay no stamp duty whatsoever. This move will take approximately 80% of first time buyers in England, Wales and Northern Ireland out of paying it, although there will be no change in Scotland.
What actually is stamp duty?
Stamp duty is a tax on anyone purchasing a property or land over a set amount. The rate varies depending on the purchase price.
How do the new rules work for first-time buyers?
The new stamp duty rates for first-time buyers purchasing properties up to £500,000 works as follows:
Purchase price up to £300,000 = No stamp duty.
Purchase price up to £500,000 = First-time buyers will only pay stamp duty, at a rate of 5%, on the portion between £300,000 and £500,000. So stamp duty will be payable on £200,000 of the purchase price only.
Purchase price over £500,000 = Stamp duty at the appropriate rate will apply.
Who counts as a first-time buyer?
To qualify as a first-time buyer you must not have previously owned or inherited a property anywhere in the world.
Do I qualify as a first-time buyer if I am buying a buy to let?
No. The property must be your main residence.
I'm a first time buyer but the person I'm buying with isn't. Do we qualify?
Unfortunately you won't as all parties in the purchase must qualify as first-time buyers.
I've already exchanged but haven't completed. Will I have to pay?
No you will not. The requirement to pay stamp duty takes effect only when you complete the purchase. The Chancellor made his announcement at 12.01am on 22 November 2017 stating the change would take immediate effect so if you have not yet completed you will not have to pay it.
How much will first-time buyers save?
The maximum stamp duty saving that you can make under the new system, compared with standard rates, is £5,000. You'll make this saving if you're buying a property costing between £300,000 and £500,000.
I'm a first-time buyer purchasing a property for more than £500,000. Will I have to pay stamp duty?
Unfortunately you will have to pay stamp duty under the same rules as non first-time buyers.
What are the stamp duty rates?
Purchase price of property
£0 - £125,000 0%
£125,001 - £250,000 2%
£250,001 - £925,000 5%
£925,001 - £1.5 million 10%
If you are a first-time buyer Jackson & Co Jackson & Co offer a confidential personal financial advisory service through an outsourced provider. Our provider has access to the whole of the market and is able to provide quotations from both high street lenders, to the more bespoke lenders, depending on your requirements.
If you would like to discuss our services or view properties we have registered with us for sale please visit our website HERE or give the Jackson & Co Team a call on 01206 863900.