Budget 2021: Sunak announces stamp duty nil rate extension
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Last week, Chancellor Rishi Sunak announced that the stamp duty holiday will be extended until June 30. The original deadline at the end of March saw buyers facing a “cliff edge” with potentially thousands missing out on the tax break all together. The stamp duty holiday threshold of £500,000 will remain in place until June 30.
The Government has also implemented a “soft landing” by further extending the holiday until September 30 with a lower threshold of £250,000.
Currently, a whopping 93 percent of local authorities across England have average house prices that fall well below the £500,000 threshold, which means plenty of buyers will benefit from the tax cut.
But which areas of the UK will still offer stamp duty savings for buyers until the end of September?
New research from lettings and estate agent, Benham and Reeves has revealed just how much of the property market is due to remain effectively “stamp duty free” thanks to the Government’s “soft landing” approach.
The average homebuyers across as many as 138 local authorities in England will continue to pay no stamp duty at all.
That’s 44 percent of the market benefitting from the Government’s double stamp duty holiday.
The area offering the biggest savings are Somerset West and Taunton.
The picturesque location has an average house price of £248,838, which falls just within the £250,000 stamp duty threshold.
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This means the average buyers will save the most for the longest period of time, paying no SDLT until the end of September.
Under normal property market conditions, buyers would expect to pay around £2,477 in stamp duty.
Another area offering the big savings is Blaby in central Leicestershire.
The village has an average house price of £248,056 which means buyers will save around £2,461 on their property purchases in the area until the end of September.
Other areas offering buyers stamp duty savings of over £2,400 per sale are Sedgemoor, South Somerset, Torridge, Breckland, the Isle of Wight and Charnwood.
Fluctuating house prices over the next few months could change which areas offer the biggest savings until the end of September.
Director of Benham and Reeves, Marc von Grundherr, said the stamp duty holiday will continue to save buyers are considerable amount of money.
He said: “Homebuyers across the nation will be rejoicing at last week’s Budget news of a stamp duty holiday extension and the tax reprieve will continue to save them a considerable amount of money when transacting.
“Some have chosen to bypass this positive influence to focus on the potential market cliff edge caused, predicting a house price dip when the expiration date does finally arrive.
“While this is highly unlikely to materialise, the government has attempted to soften any blow by further extending the deadline for purchases of £250,000 or less.
“However, the reality is that this ‘gradual’ return to normality might not actually be that gradual.
“While it will reduce the number of transactions paying no stamp duty by quite some margin, many homebuyers will still benefit and this is likely to keep demand extremely buoyant right through until September.”
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