You must have heard the recent announcement to temporarily reduce Stamp Duty. With all the other noise in the world, we want to make sure you understand what the reductions are, and what they could mean to you.
The Government is focused on keeping the property market stable, hence the reductions. Hooray, amongst all the doom and gloom of the pandemic, this is great news for homebuyers and investors alike, saving potentially millions of people thousands of pounds. Yay!
So now is a really great time for people to buy up property! Seasoned investors are already reaping the benefits…and remember these reductions revert to the standard Stamp Duty Land Taxes on 31st March 2021!
These are the rates from GOV.UK that apply whether you are buying your first home, or have owned a property before:
- Zero up to the value of £500,000
- 5% on the next £425,000 above £500,000
- 10% on the next £575,000 above £925,000
- 12% on the remaining amount above £1.5million
The rates are higher rates for additional investment properties and second homes, but still way more enticing than pre-July 2020. To give you an idea, if you were looking at the top end of the scale, your bill could be halved from £30,000 to just £15,000. Nice!
So far, the Government has seen the response that it sought; the buoyancy of the housing market has picked up rapidly, But, with the furlough period ending on 31st October, potential redundancies could slow things down again, but with that could come a reduction in house prices.
If you’re looking for an HMO, Serviced Accommodation or Buy To Let there are still great lending opportunities to be found. And with the reduction of VAT on accommodation, if you have Serviced Accommodation units, you can pass on a 20% reduction in price to win your guests back! Great customer service!
With all these incentives; stamp duty cut, prices dropping to below market value, VAT cuts, impending changes to commercial planning laws AND new green grants, we are entering a really exciting period for property investing…as long as you know what you’re doing!
An educated investor knows all about the upsides of a turbulent economy and using it to his or her advantage. This could be your golden opportunity to grow a portfolio!
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