Good news for the housing market!
24 November 2017
The Chancellor’s announcement of Stamp Duty Land Tax (‘SDLT’) relief for first time buyers of residential properties has been welcomed by first time buyers and many other stakeholders in the residential property industry. As our client Uel McKibbin, Financial Director of McAlorum Group, one of NI’s leading housebuilders points out “At a time when there is some reticence in the market, due to uncertainty in relation to Brexit and interest rates, the SDLT cut will be comforting for first time buyers”.
The relief, which takes effect immediately, means that where the purchase price is £300,000 or less, no SDLT will be payable by first time buyers, whereas previously, first time buyers paid SDLT on a purchase price of £125,000 or higher. Where the purchase price is more than £300,000 but less than £500,000, the first £300,000 will remain exempt however SDLT will be payable on the amount exceeding £300,000, at a rate of 5%. The Treasury estimates that the relief will help over one million first time buyers get onto the property ladder over the next five years.
For the purposes of the relief, a first time buyer is someone who has never owned an interest in a residential property before and who is purchasing the property to occupy as their only or main residence.
In addition to the first time buyer relief the Chancellor announced some tweaks to the SDLT regime affecting those with multiple dwellings which has been almost universally unpopular since introduced in April 2016. The 3% SDLT surcharge on additional residential properties, such as holiday homes and buy-to-let properties, was aimed at landlords but had a range of unintended consequences, some of which have now been addressed, including relief for divorcing couples and transfers of property between spouses or civil partners.
Maeve Corrigan is a solicitor in Carson McDowell’s Real Estate department and regularly acts for both first time buyers and developers. Should you require any advices in relation to SDLT, or have any general queries in relation to buying or selling residential property, please do not hesitate to contact Maeve on +44 (0) 28 9024 4951.