Changes to stamp duty and how they will affect you
23 September 2022
The government’s mini-budget of 23rd September announced significant cuts in stamp duty, making it easier for first-time buyers to get onto the property ladder.
Stamp duty is an additional tax to be paid on top of the purchase price, alongside legal fees, relocation costs, and other expenditures relating to moving home. The amount of stamp duty you pay depends on the value of the property you’re buying.
The most significant changes you need to know about are:
- If you (and anyone else you are buying with) are a first-time buyer
- You only pay stamp duty on properties worth more than £425,000 (it was previously £300,000)
- You now pay 5% stamp duty on the home value between £425,000 and £625,000 (it was previously 5% between £300,000 and £500,000)
These changes came into effect immediately after the announcement which means even those buyers who are already in the process of buying a home can benefit from these changes.
Stamp Duty and Shared Ownership
Shared Ownership buyers have the option of paying their stamp duty on the full market value or the value of the share of the property that they are purchasing. Since the vast majority of first-time buyers will be purchasing shares below the £425,000 threshold, they will be exempt from any stamp duty.
Those buying shares in lower-priced homes can avoid paying stamp duty both on their initial purchase and any future staircasing by electing to pay stamp duty on the full market value at the very outset.
Get in Touch
If you’d like to know more about how these changes may affect your current purchase with Legal & General Affordable Homes, speak with your dedicated member of the sales team.
Equally, if you think the changes to stamp duty open up the door to shared ownership for you, get in touch and we can discuss your options.
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