PPA welcomes shock stamp duty overhaul

Members of the Portsmouth Property Association have welcomed a long overdue shake-up of stamp duty as a boost for the housing market.

Chancellor George Osborne made the shock move to slash the unpopular levy in his Autumn Statement to the House of Commons.

The sweeping reform – which has already come into immediate effect – will save buyers an average of £4,500 as long as their new home is worth less than £937,500.

Steve Sprake, Director of Pearsons in Southsea, said: “It is very positive news.

“It will help the buying and selling public as there will be more flexibility on price.

“Buyers will make a saving on stamp duty and sellers will also have more money in their pocket as they no longer have to stick to rigid bands.

“This will keep the market moving and allow us all to attack the new year with renewed confidence.”

Some 98% of home buyers are expected to benefit from the overhaul, helping first-time buyers onto the bottom rung of the property ladder and other property owners step up.

Albert Zarb-Cousin, Property Consultant at Town & Country Southern in Drayton, said: “The reform has been very well received on all counts.

“All of our clients who have been on the phone are aware of the changes. It is very positive indeed.”

As well as injecting fluidity into the market and stimulating activity at the lower end, it should also boost wider consumer confidence and housebuilding.

Ian Lee, a former PPA Chairman and a Director at McAndrew Martin chartered surveyors in Portsmouth, added: “This will have positive knock-on effects for the industry as a whole. “Anything which helps the housing market has to be a good thing.”

PPA Secretary Neil Hawkins, of Chandler Hawkins chartered surveyors in Portsmouth, said: “This reform of a vastly unfair tax has been long overdue.

“It will be of real benefit for the majority of the market, and will be welcomed by many buyers and sellers as well as members of the PPA.”

The previous stamp duty system was based on amounts owed jumping at certain threshold levels.

It was considered grossly unfair as someone who bought a home for £250,000 would pay £2,500 stamp duty under a 1% levy but anyone who paid £250,001 would be liable for a duty of £7,500 under a 3% rate.

This has been replaced by a graduated rate, with different amounts of duty due on the parts of a property’s value that fall into five new bands. They will no longer pay the same rate on the entire purchase.

Nothing will be paid on the first £125,000 of a property price and then 2% on the next portion of the property up to £250,000, 5% up to £925,000, 10% on the portion up to £1.5million and 12% on anything above that.

Under the new duty, buyers will save £1,000 on a £150,000 property and £500 on a £200,000 property.

On the UK average first time buyer price of £210,000 there will be a saving of £400, while at the average UK house price of £275,000 the saving will reach £4,500.

The saving stands at £4,900 on a property costing £510,000 and £1,000 on a £900,000 property.

A £2million property will carry an increase of £53,750 and a £5million property will have an increase of £163,750.

The Portsmouth Property Association promotes and maintains the highest professional ethics and integrity amongst its members in the property services industry but also aims to create a positive image of Portsmouth and the surrounding area and encourage inward investment.

Email [email protected] or call 023 9282 0420 for more details.