Apparently some astute investors have spotted this as RICS has reported a “lift in housing demand” and it has reported that since the announcement in November, 16% more chartered surveyors had reported a rise in new buyer enquiries, with surveyors citing a rush to beat April’s stamp duty rise as the reason.
The risk is that there will be a rush for buyers to complete their purchasers prior to 1st April in order to avoid the increase in Stamp Duty Land Tax (SDLT). This will clearly distort the figures in relation to residential property transactions for the first quarter and will no doubt lead to a slump thereafter.
Sellers should also be alert to the fact that after 1st April it may well be more difficult to sell properties in areas which are currently dominated by tenanted properties. This could be a blow to those properties located in areas which fell within HMRC’s previously designated “disadvantaged areas” and it will not be a surprise to see prices start to fall.
There are however many people out there who are totally unaware of the coming changes and may not even be aware that the surcharge will affect them. So the question is what are the changes and who will they affect buyers?
|Value of second property/buy to let (£)||Current SDLT (£)||SDLT from 1 April 2016 (£)||Increase in tax (£)|
The consultation period will continue until 1st February and the full details will be announced at the next budget. Whilst it is clear that this is set to impact upon buy-to let investors what is less clear is how this will impact upon other purchasers, for example:
Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.