Did you catch Wednesday’s Autumn Budget? As predicted, the Chancellor’s speech was focused on the housing market with several changes set to take place immediately and throughout the coming year. From fewer people paying Stamp Duty to more homes being built, some of the Budget may have been expected but Philip Hammond still had a few surprises up his sleeve. We take a look at how the Chancellor’s statement will affect the property market.
A popular story in the news and amongst estate agents was that stamp duty is to be abolished with immediate effect for all first-time buyers who are purchasing a property worth up to £300,000. If you are stepping on to the property ladder for the first time in London you will pay no Stamp Duty on the first £300,000 of the cost of a £500,000 home. It’s no surprise that this has grabbed the headlines – if you’re a first-time buyer it could save you thousands of pounds, which you could put towards your deposit. If you are a homeowner already you could still benefit, as there will be increased activity in the property market particularly from first-time buyers. As a second-stepper looking to purchase your next home, your current home will be in high demand, appealing to many first-time buyers.
By the mid-2020s a target of 300,000 homes a year are planned to be built. The Chancellor also confirmed that £2 billion will be available to fund affordable housing, with a further £34 million set aside for construction training across the country.
Capital Gains Tax
If you are a private investor or own a second home, as of next year you will be able to retain more of your profits, as the Chancellor has increased the Capital Gains Tax threshold by £400 to £11,700. Capital Gains Tax does not apply to your main residence, but is charged on your second home and other assets. If you are in a civil partnership or are married you will receive double the allowance, giving you a potential tax-free allowance of £23,400.
Currently, if you own an empty property you are required to pay 50% of the council tax; however, new changes allow your local authority to charge you 100% of the council tax. This crackdown is an attempt to ensure that homeowners are encouraged to sell or let an empty property, or face having to pay the full monthly bill.
Homelessness is an issue that is close to our hearts at Anthony Pepe, and we have recently pledged our support to Wrap Up London for the second year running. The charity collects your old or unused coats and donates them to a number of local charities, including those supporting the homeless. In the Autumn Budget, Philip Hammond announced that the government will launch a Homelessness Reduction Task Force as well as invest over £40 million into helping reduce by half the number of people who are sleeping rough by 2022.
Following the announcement of the Autumn Budget, are you thinking about selling your home, or perhaps purchasing a second home? Contact your local branch to speak with an experienced member of our team who can advise you on the current property market in your area.