Stamp Duty Increase for Landlords and Multiple Homeowners

In the Autumn Statement, Chancellor George Osborne announced a substantial increase in Stamp Duty on the purchase of additional residential properties.  That will therefore apply to situations such as purchase of a property to let out or of a second home.

From April 2016 any such properties will face an additional 3% charge, on top of the existing levy.

This means the new stamp duty structure in England and Wales will look like this:

Stamp duty is applied only to the portion of the property value falling in that band, similar to income tax.

So while a sole home valued at £300,000 would incur £5,000 stamp duty, if that same £300,000 were an additional Buy to Let property for example, the stamp duty charge would increase to £14,000 from April.

Clearly that’s a massive increase in costs so we can expect a flurry of activity as potential “additional property buyers” seek to beat the April deadline.  Anyone thinking about becoming a new landlord or adding to an existing portfolio is bound to be keen to complete the purchase before the new higher charges come into effect.

That could therefore intensify competition for suitable property in the next few months.  From April, however, aspiring first time buyers may find life a little easier as investor numbers ease back. 

Guild Mortgage Service, Provided by London & Country Mortgages

YOUR HOME OR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

Most buy-to-let mortgages are not regulated by the FCA