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Have the Stamp Duty changes affected your property purchase in 2016?

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According to the latest figures from HM Revenue and Customs (HMRC), properties sold in April this year, fell by an enormous 45% from the previous month. This is likely down to the fact that in March 2016, a record number of property transactions took place – 164,000 to be exact – as people rushed to buy properties before the higher rate of Stamp Duty came into force on the buy-to-let properties and second homes.

Will these changes affect you?

If you weren’t one of the buyers that rushed their purchase through earlier this year, you may be worried that the stamp duty changes may still have an impact if you are planning to buy property this year. So here is what you need to know…

Regular stamp duty rules

If you’re purchasing a property, you’ll still need to pay stamp duty, but if the home is your main residence you’ll only need to pay the standard level of tax. If you’re unsure of what this is you can check out the current stamp duty rates here.

You’ll need to pay stamp duty whether you’re a first-time buyer or you’re selling your home and purchasing a new property. The only exemption to stamp duty is on properties that are valued less than £125,000.

New stamp duty rules from 1st April 2016

The government introduced a higher rate of stamp duty this year in order to help struggling first-time buyers onto the property market, who may be missing out on the more affordable homes due to ‘competition’ from landlords and property developers.

If you are purchasing a property that you don’t intend to live in full time i.e. a buy-to-let or a holiday home then you will be affected by the changes. On top of the standard rate of tax, you’ll now be expected to pay an extra levy of 3%.

Read more about how the changes will affect you here.

What else do I need to know?

There are very few exemptions to the stamp duty charges so if you are planning on purchasing a rental property then you’ll want to make sure you’re getting the best deal on your mortgage to account for the additional money you’ll be paying in stamp duty.

Whether you’re a landlord, moving home or a first-time buyer, one of the best ways of getting a great deal on your mortgage is by speaking to an adviser. They can search the whole of the market to find the best mortgage to suit your circumstances and could help to cut your mortgage rate which may help to soften the impact of the stamp duty charges.

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The above post is intended to be informative but does not constitute advice – financial, legal or otherwise. Any opinions given are the author’s own and do not necessarily reflect the views of SO Media or the Mitchell Farrar Group.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

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