While the stamp duty holiday extension is mainly focused on the housing market, it is an opportunity for landlords to expand their property portfolio at a lower cost.
The stamp duty saving applies to landlords, and even though the extra charge applies for purchasing additional property, landlords can save money. Therefore, if you are looking to increase your rental stock, you still have time to do so.
If you need any guidance or support in the housing market after the March 2021 Budget, please get in touch with Just Lets Peterborough.
Stamp duty holiday extension offers relief to many buyers
The Chancellor, Rishi Sunak, has announced an extension of the stamp duty holiday until June 30.
Following this date, the nil rate band for stamp duty will be set at £250,000 until the end of September.
On October 1st 2021, the nil rate band will return to the previous £125,000.
The additional three months of the stamp duty holiday will provide comfort for buyers and vendors whose property deal was still in the process of being completed.
Many would-be buyers were concerned at the thought of having to pay the full stamp duty to complete their move. In some cases, this would add £15,000 to the price of buying a home.
This rate applies only to home buyers in England and Northern Ireland. There are different schemes in place for property buyers in Scotland and Wales. It will be up to those nations to decide if they wish to follow suit or offer a similar scheme.
In his own words, Rishi Sunak said; “I can announce today the £500,000 nil rate band will not end on March 31, it will end on June 30. Then, to smooth the transition back to normal, the nil rate band will be £250,000, double its standard level, until the end of September – and we will only return to the usual level of £125,000 from October 1”.
Early thoughts from industry observers
Buying agent Henry Pryor said: “There will be a new cliff edge — it will just move from the end of March to the end of June. There will be a whole new load of people who will be wailing and gnashing their teeth because they could not get their deals over the line by June 30.”
Mark Peck, Director, Cheffins, an auctioneer business, said: “Whilst the extension to the stamp duty holiday will be welcomed for those with property sales already agreed, the government here is simply kicking the can down the road with chaos set to ensue once the tax break is reduced in June and tapered until September. The pressure on the property industry since the announcement of the stamp duty holiday has been immeasurable and this extension will simply continue to add to the strain already being felt by both buyers and sellers as they look to complete on sales before the end of the tax break.”
Mark concluded by saying; “Whilst the chancellor has attempted to manage this with the tapering system until September, the property industry will need to brace itself for further pandemonium throughout the summer months. Whilst the stamp duty holiday certainly allowed the property market to continue with full force throughout the coronavirus pandemic and ensure that property sales continued at a fast pace, it has created an unhealthy scenario with values increasing at unsustainable levels within a short space of time.”
There was no formal announcement of changes to Capital Gains Tax (CGT) in the Budget, although proposals are expected to follow soon.
If you are a landlord in or around Peterborough, and you need assistance in managing your rental property, we can help. We know these are challenging times for landlords, but there is a demand for rental property. When you need guidance in the local market, contact Just Lets Peterborough today, and we will be happy to help you.
You can find Just Lets Peterborough at 142 Oundle Road, Peterborough, Cambridgeshire, PE2 9PJ. Feel free to email us at firstname.lastname@example.org or call us today on 01733 346255.