Stamp duty reform to send shock waves through central London market
Wednesday, December 3, 2014
Whilst the stamp duty reform is great news for those purchasing property below £925,000, it is likely to send shock waves through the central London market, particularly in the £1.5m-£2m price range. This market has been especially active with buyers sticking below the 7% Stamp Duty and proposed mansion tax thresholds. These buyers will now have to pay a significantly higher amount.
For example, someone purchasing a £1.9m property would be paying £95,000 under the old Stamp Duty rules, whereas under the Government’s reforms announced by the Chancellor today, they will be paying almost £50,000 more at £141,750. However, those buying just above £2m won’t be quite so heavily hit, for example, someone purchasing at £2.1m will now be paying £165,750 – an increase of £18,750.
We are already seeing the effects of the reforms – we were due to exchange on a £2 million property this week and the buyer is now pushing to do this today. I expect a lot of lawyers will be working late into tonight to exchange on sales between £1.5m and £2m!
Jamie Lester - Head of Haus