Making sense of the key budget points for housing

new property tax cut

Many of us are dumbfounded by the changes in the world due to Covid-19. I don’t know of many families who have not been affected by this pandemic on a human level, first and foremost, and then a financial level.

Our much loved high streets have been financially battered with many SME’s (small businesses) struggling to stay alive. I cannot remember a time of so many challenges from personal loss to mental health to the challenges of homeschooling; respect to all teachers after my efforts in this regard!

Chancellor Rishi Sunak has made several critical decision to help the economy along; many will directly impact the housing market. I have had several questions from friends and customers asking me to make sense of these new changes:

Stamp Duty Land Tax Holiday

If you are buying your main home, this is scrapped for all purchases up to £500,000. It is worth noting that investors and second home purchases will benefit too, but the enhanced 3% remains in place for these types of purchasers. This holiday is for any residential property completions up until 31st March 2021.

In the Brockley, SE4 postcode, the typical average terraced house costs £655,973*. If you purchased this property previous to 09th July 2020, then you could expect to pay £22,798.  Now, you would pay £7799. That is a £15,000 saving!

The typical flat/apartment in Brockley costs £398,449* and previous to 09th July a first-time buyer would have paid £4922 and a next time buyer £9922, but now you would pay £0.  As an investor, you would have paid £21,875 in Stamp Duty and now £11,953.

In the Charlton, SE7 postcode, the typical average terraced house costs £542,917*. If you purchased this property previous to 09th July 2020, then you could expect to pay £17,145.  Now, you would pay £2145. That is a £15,000 saving!

The typical flat/apartment in Charlton costs £304,229* and previous to 09th July a first-time buyer would have paid £211 (so not much of a saving) and a next time buyer would pay £5211, but now you would pay £0.  As an investor, you would have paid £14,338 in Stamp Duty and now £9127.

In the Greenwich, SE10 postcode, the typical average terraced house costs £747,652*. If you purchased this property previous to 09th July 2020, then you could expect to pay £27,382.  Now, you would pay £12,382. That is a £15,000 saving!

The typical flat/apartment in Greenwich costs £525,857* and previous to 09th July you would have paid £16,292, but now you would pay £1292.  As an investor, you would have paid £32,068 in Stamp Duty and now £16,292.

In the Lee, SE12 postcode, the typical average terraced house costs £538,838*. If you purchased this property previous to 09th July 2020, then you could expect to pay £16,941.  Now, you would pay £1941. That is a £15,000 saving!

The typical flat/apartment in Lee costs £316,614* and previous to 09th July a first-time buyer would have paid £830 (so not much of a saving) and a next time buyer would pay £5830, but now you would pay £0.  As an investor, you would have paid £15,329 in Stamp Duty and now £9498.

If you are unsure what Stamp Duty costs would be for a future purchase check out this calculator https://conranfinancial.co.uk/how-much-is-stamp-duty/.

Green Home Grant Scheme

This grant is available to homeowners and landlords to improve energy efficiency to protect our environment and reduce costs while keeping employment thriving.

This grant is available from September and will last for one year.

The way this works is that you will be invited to apply online and will be directed to an accredited, locally approved supplier.  Upon approval, a voucher for the governments share will be issued.

The government will pay for at least 2/3’s up to a maximum of £5000. For low-income households, the government have suggested that they will pay 100% up to £10,000. I await more detail on exact specifics, but I will update my blog on the Conran website when I know more. www.conranestates.co.uk

I am told that this can cover energy assisting improvements such as insulation, double glazing and boiler replacement.

If you are a Landlord, your energy efficiency must be at an ‘E’ rating or better so this scheme works well for homeowners and landlords too.

Whether these decisions stave off a painful recession is yet to be seen, but time will tell.

I hope this helps and if you need anything, please do make contact.

Regards

Simon Hughes - Conran Estates

Simon

*Source: Dataloft 09/07/2020