Stamp duty threshold raised in Chancellor’s summer statement – comment

Jeremy Raj, national head of residential property at law firm Irwin Mitchell, gives expert comment on the news that the stamp duty threshold will be temporarily raised to £500k until 31 March 2021.

“The changes announced to SDLT today went further than most within the industry had dared hope. With an immediate increase in the tax-free band to £500,000 for a fixed period until 31 March 2021, there will be a real boost to the sector. There will also be widespread relief that the implementation has not been delayed until the autumn, which would potentially have stalled the market entirely.

“The Chancellor prefaced his announcement by explaining how key the residential property market and the housebuilding sector are in relation to the confidence and strength of the economy overall. There is no doubt that the recent uncertainties and practical difficulties created by lockdown have had a massively detrimental effect.

“It is important to note that while the effect on the London market will be minimal, the vast majority of conveyancing transactions throughout the country will see a significant and immediate bonus effect, that should encourage greater activity.

“We can however expect a number of interesting discussions regarding how this windfall is to be shared between buyers and sellers. Clearly anybody that completed their transaction within the last month or two will be rightly upset to have missed out. It also remains to be seen whether the market reacts by adjusting prices overall or leaves the windfall with buyers.

“Overall, however, this is a hugely welcome announcement for housebuilders, the residential property industry, homeowners and potential homeowners.”

Kindly shared by Irwin Mitchell