Changes To Stamp Duty Rules To Cause Housing Market Shake-Up
Online, April 11, 2012 (Newswire.com) - Measures announced by George Osborne in the 2012 Budget, included an increase in stamp duty to 7% on properties worth over £2 Million as well as a rise to 15% for properties bought through a company. In real terms this represents an additional £40,000 on a £2 Million property purchased by an individual, taking the rate of stamp duty to £140,000. For a sale that is enveloped in a company, a £160,000 increase means that an additional £300,000 must now be found on top of the £2 Million purchase price.
Experts voiced their fears that the move could bring about a slump in house sales at the top end of the market, where many properties in Central London's most prestigious postcodes sit well above the £2 Million barrier. For some time the top tier of the market has been buoyed up by wealthy overseas buyers looking for a safe haven for their investment. The majority of these invest via corporations or trusts and punitive tax measures are likely to result in the city losing much of its attraction.
The rise coincided with the end to stamp duty relief on properties under £250,000, coming as a double blow to property owners in search of a quick sale to raise funds or avoid repossession. Falling house prices and highly restrictive mortgage lending have seen many people witness the market value of their home fall through the floor and disincentives to purchasers will do nothing to alleviate the situation.
Founder of property buyers St Genix, Evgeni Vachkov said of the move, "This will have an impact at both ends of the spectrum, not just on property prices but on people's ability to sell fast. Whether they are in financial difficulties, trying to head off repossession, relocating or simply looking to release funds fast, this will make it harder than ever to find buyers with sufficient funds and who can complete quickly".
St Genix specialises in achieving fast property sales for individuals, helping them to avoid repossession, pay off their mortgage and free up funds in as little as five days.