‘It’s bittersweet’: What buyers think of the Chancellor’s stamp duty cut

JUK Chancellor Kwasi Kwarteng has announced a permanent reduction in stamp duty for property purchases in England and Northern Ireland – a move that is part of a mini-budget that critics say will reward the wealthy more than low-income people.

Under the new system, in effect from Friday, the first £250,000 of a property’s value will be exempt from stamp duty. Buyers will pay 5% of the value of the house over £250,001, while the part between £925,001 and £1.5m will continue to be taxed at 10%. Any property worth more than this will be subject to stamp duty rates of 12%.

The threshold at which first-time buyers start paying stamp duty will increase from £300,000 to £425,000, and the maximum value of a property on which first-time buyers’ relief can be claimed will also increase, from £500 £000 to £625,000. .

Here, four people from different parts of the country explain how the changes could affect them.

The first buyer

Ellie Stevens, a local government grants manager, has delayed exchanging her first property purchase in hopes that a stamp duty reduction will be announced and will now save £5,000.

Ellie Stevens, 29, fears the stamp duty cut will make it harder for people like her to buy a long-term home. Photo: Ellie Stevens/Guardian Community

Stevens and her partner, a graphic designer, both 29, have been renting in Bristol for seven years and have been trying to buy a house for a year.

“This cut is really good news for us personally. It’s been a year of savings for me. But I think it will make it harder for people like us to buy a house long term. The real estate market here is already totally crazy. We made offers on 10 houses, always 10% above the asking price, and we only accepted two,” says Stevens. “For each property, there were at least 15 buyers interested.”

During the pandemic, house prices in Bristol have soared, in part, according to Stevens, due to Rishi Sunak’s temporary stamp duty furlough.

“We had to offer £50,000 more than the asking price to secure this place. I don’t think anyone in our chain will raise their prices as a result of these duty reductions, but if this offer had failed we would have been kicked out of Bristol and moved out of town, because of rising mortgage rates and the costs.

The growing family

For Chris, 36, an IT engineer at a trading company, the stamp duty reduction is “bittersweet”.

Chris says the stamp duty reduction is “bittersweet”. Photograph: Community of Guardians

On the one hand, Kwasi Kwarteng’s announcement confirmed Chris’s decision to extend his two-bedroom house in Walthamstow, northeast London, which his two young boys have started to outgrow.

“My wife and I moved here with our sons six years ago, but it’s not big enough for us now,” he says. “We discussed an extension, but decided there was no reason to just move. So the idea was to explore that next year. We’ve had an assessment and it’s about as serious as it gets. But stamp duty reduction is another reason to move forward.

Chris says he’s not concerned about the potential for house prices to rise as a result of the cut. “No matter [price changes] arrives at a new house, will arrive at our house. We’re not first-time buyers, so I take the hot or cold market with a pinch of salt. »

However, Chris has reservations about the government’s broader economic plan. “Although [the stamp duty cut] will benefit me, I kind of share the concerns that we as a country are borrowing a lot of money. But I guess I just have to do what we have to do as a family.

The second home buyer

Rajinder Singh, 34, a mortgage broker from Coventry, bought his first home 14 years ago and is looking to buy a second, larger property to move into with his wife and children. He calculated he would save £2,500 and sees the stamp duty reduction as “a bright spot”, although he had hoped for something more similar to Rishi Sunak’s stamp duty holiday in July 2020.

Rajinder Singh
Rajinder Singh believes the move is for first-time buyers. Photograph: Community of Guardians

“I will see a slight reduction in my stamp duty, but not as much as I hoped maybe based on what happened just after the first lockdown. As part of the changes, the previous chancellor implemented I would have saved a lot more, which is why I think these reductions are geared more towards first-time buyers.

“I’m lucky in the sense that I don’t have to sell my property – it will be rented out via a let-to-buy mortgage. I can buy the next one using part of the capital of the one I have.

Singh does not believe house prices will rise after the stamp duty cut the same way they did in 2020, despite recent warnings from analysts. “This stamp duty reduction came at a time when we were just coming out of lockdown, when there was a lot of frustration building up and people had saved money. It was just the perfect cocktail for there to be a massive increase in real estate prices. I don’t think it’s going to have the same effect.


Robert Hughes, a retired civil servant, has been trying to sell his house in Lincolnshire for some time and hopes stamp duty cuts will help revive a sluggish housing market in his area.

“Our house has been on the market for a few weeks, we lost a buyer as the chain collapsed. We would like to be closer to our children. Judging from sites such as Rightmove, it is clear that fewer properties are coming to market in this area and properties are sitting unsold for much longer. Many sellers have recently slashed prices here as higher interest rates and rising inflation dampen the desire for major individual investments.

“I think today’s stamp duty cuts are about right and will stimulate the housing market while other pressures such as interest rates and inflation would dampen the rise in housing prices. real estate – although in the long term, real estate prices may well rise because of this decline. It’s a bit of a crystal ball situation. It’s also true that many people can now spend the savings to improve their housing, which stimulates the economy. Overall, I think this is a good thing that will provide a much needed short-term economic boost.

#bittersweet #buyers #Chancellors #stamp #duty #cut #Sense Designer