Autumn Statement slashes tax for home-buyers
George Osborne announced in his recent Autumn Statement that the majority of homeowners will benefit from the economic changes, in part, offering some relief to home-buyers. These new rules will come into effect from midnight on 4th December 2014.
As it stands now, current homebuyers who own a house between the values of £125,000 to £250,000 pay a 1% tax, and those owning a home valued at £250,001 to £500,000 pay 3% tax. George Osborne claimed that the current system is “badly designed” and fails to meet the needs for existing home-buyers. The new costs that will Osborne will put in place will in turn reduce costs of buying a home for around 98% of buyers, which we think is fabulous. The House Crowd are always looking for ways to help buyers invest in a property – hence our crowdfunding platform – and with the new measurements put in place for home-buyers, it looks like it could benefit buy-to-let too.
The overall tax cut will be £800 million per year and would save home-buyers an average of £275,000 from £4,500. Plus it also means those who are lucky enough to own a home that is valued at £937,000 or more will be the folk who see their bills increase. Sorry footballers!
George Osborne said “The system I introduce today replaces a badly designed system that has distorted our housing market for decades. It reduces the stamp taxes for 98% of people who pay them in this country. It increases the taxes on the most expensive 2% of homes, but only asks people to pay that tax when they buy the house and they have the money”.
But don’t worry if you’re a homebuyer who has already exchanged contracts on a property and haven’t yet paid Stamp Duty, but have completed the purchase on your home on or after 4th December 2014, as you will have the option on whether or not to apply the old or new rules. Sounds a little complicated doesn’t it?
In a nut shell, the new rules will benefit those living in properties under the value of £937,000, which means it will also benefit those looking for investment properties.
The House Crowd will keep an eye on how Mr Osborne’s new rules come along, but in the meantime, feel free to get in touch with us today for more information about property investments and crowdfunding.