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Stamp duty changes cut £1000 from cost of buying North East home

Changes to stamp duty announced by George Osborne in his Autumn Statement could cut £1000 from the cost of buying a North East home.

House buyers currently pay a 1% duty on properties purchased for more than £125,000, and 3% on homes bought for more than £250,000.

The Chancellor this afternoon announced that from midnight tonight home buyers will instead pay no stamp duty on the first £125,000 of a property’s value and 2% on the remaining amount up to £250,000.

Research last week from local sales and lettings firm KIS showed the price of an average North East property to be £157,244.

The changes mean buyers who faced Stamp Duty bills of £1572 today will see bills cut to £644 tomorrow.

• Buyers in South Shields (average price £130,360) could see their Stamp Duty cut to £107 from £1304.

• Buyers in Sunderland (average: £136,075) could see Stamp Duty cut to £222 from £1361.

• Buyers in Newcastle (average: £190,105) could see Stamp Duty cut to £1302 from £1902.

• Buyers in North Shields (average: £168,142) could see Stamp Duty cut to £863 from £1681.

• Buyers in Durham City (average: £204,346) could see Stamp Duty cut to £1587 from £2043.

Property expert Ajay Jagota, founder and Chief Executive Officer of the North East’s most innovative sales and lettings business KIS , welcomed the changes.

The firm is famous for being the first letting agent in the UK to abolish deposits, replacing them with a one-of-a-kind landlord insurance policy offering guaranteed rent, deposit replacement, legal assistance and round the clock third party emergency home repairs.

Ajay said:

“Stamp Duty is one of the costs of buying a home a lot of people don’t consider until the last minute, but these changes could make a real difference for a lot of buyers and are to be welcomed.

“With North East properties typically much closer to £125,000 threshold than other parts of the county, our region is likely to one where buyers benefit the most, and with prices falling back over the past two months the changes could also provide a well-timed shot in the arm for the local property market.

“For the buy to let investor they could mean both a bigger and faster return on their investment and extra capital to invest in improving the condition of their property. For the first time buyer it could mean the difference between being able to buy a property and not being able to buy a property.

“If I can nitpick just a little, with an estimated bill of £800m the changes don’t come cheap for reforms which don’t do an awful lot to address the biggest issue facing the UK housing market - the growing shortage of homes – and they don’t exactly recognise how Britain is increasingly a nation of renters, with the number of people choosing not to buy rocketing by 90% in 10 years, but apart from that these are the good changes at a good time.”

This was posted in Bdaily's Members' News section by Ajay Jagota .