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Stamp Duty relief for First time Buyers

Piggy Bank Budget savingsThe budget is out, with £15.3 billion new financial support for house building over the next five years and with the Government setting aside £1.2 billion to buy land and £2.7 billion for related infrastructure.  The Government announced plans to create five new so-called ‘garden’ towns, and there was a headline-grabbing cut in stamp duty for first time buyers.

Stamp duty is currently paid on property purchases over £125,000, with a ‘slice’ tax where buyers pay at the relevant rate for each band, rather than a flat rate across the whole amount.  With immediate effect, stamp duty is abolished for first-time buyers on properties worth up to £300,000, or on the first £300,000 of a property worth up to £500,000.

Property law expert and Solicitor Johanna Withams based in our Bishop’s Stortford office said: “The change in stamp duty has caught most of the attention.  It’s certainly a move that will be welcomed by first time buyers, but does add yet more complexity to the application of this particular tax, where we already have different rates for second home owners and landlords.

“Buyers need to read the small print before rushing out to make an offer, as there are clear distinctions on who is eligible. It will not apply if any property has been owned at any previous time, whether here or anywhere else in the world, and it must be the only or main home for the buyer.  In a joint purchase, everyone would need to qualify as a first-time buyer.  Buyers will need to check out the detail with their solicitor, and the benefit must be claimed when the Stamp Duty Land Tax return is made to HMRC during the purchase process.”

If you have any questions, or wish to discuss your potential purchase through with us, please give us a call at any of our offices based in Bishop’s Stortford, Hertford and Enfield. 01279 715555, 01992 558411 or 0208 366 6411

Web site content note: 

This is not legal advice; it is intended to provide information of general interest about current legal issues.

Reference:

https://www.gov.uk/government/speeches/autumn-budget-2017-philip-hammonds-speech

https://www.gov.uk/government/publications/autumn-budget-2017-documents


Landlords lose and whiplash gets cracked in Osborne’s autumn budget

Backtracking on the contentious cuts to Working Tax Credits caught the headlines when Chancellor George Osborne delivered his Autumn Budget statement, alongside a boost to building and good news for first time buyers.

The Chancellor announced the allocation of £4 trillion of public spending over the next four years, with an £8 billion reduction in borrowing now being forecast and a predicted surplus of £10 billion by 2019-20.

In a package of measures designed to help with housing, Mr Osborne announced a doubling of the housing budget to £2bn a year, to fund 400,000 new affordable homes by the end of the decade, to both buy and rent. Help to Buy has been extended with restrictions removed on shared ownership schemes, so more people can get on the housing ladder.  There’s also a new Help to Buy equity loan scheme that will give London buyers 40% of the home value from early 2016, doubling the 20% offered under the current scheme.

But for second home owners and landlords looking to add buy to let properties to their portfolio, the Chancellor dealt another blow by announcing a massive 3% extra levy in land tax stamp duty on such purchases with effect from April 2016. The money raised will be used to fund investment in local communities. This follows on the heels of his last Budget when he announced that there would be a cut in tax relief on mortgage interest for landlords.  Tax relief is set to be gradually restricted to the basic rate, currently 20%, where landlords had previously been able to offset mortgage interest against top rates of tax.  The shift was to tackle what the Chancellor called an “unfair advantage” for landlords over homeowners.

Said Brendan O’Brien Managing Director of Breeze & Wyles Solicitors Limited:  “Landlords have been in the Chancellor’s sights for some time, with high levels of buy to let pushing up house prices and reducing affordability for first time buyers.  Buyers of second homes will also be caught by this new rate of stamp duty on their future purchases.  With the policies he set out today, it’s likely to reduce some heat in the housing market, once the new stamp duty level kicks in.”

He added: “The other sting in the tail for landlords and others making capital gains is the shift towards faster digital taxation processes.  Mr Osborne has ambitions to build one of the most digitally advanced tax systems in the world and one result of this will be faster collection of capital gains tax, which is payable on any gain made by a landlord or second home owner on a property when they sell up.”

The Chancellor also announced that people will no longer be able to get cash compensation for minor whiplash claims, in a crackdown designed to cut the number of fraudulent claims and likely to lead to reduced motor insurance premiums.   Instead, such injuries are expected to go to the small claims court with the upper claims limit increased from £1,000 to £5,000.

Underused courts will also be closed, saving £700m which will be used towards the introduction of new technology into the court service.

ENDS

Web site content note: 

This is not legal advice; it is intended to provide information of general interest about current legal issues.

 


House sellers are facing testing questions

Property prices keep on hitting the headlines, but anyone getting their home on the market with the hope of celebrating Christmas in a new place, should be getting the paperwork in order before a buyer knocks on the door. 

It’s tempting to throw away old papers when spring cleaning or thinking of moving home, but anything relating to renovation or upgrading on a property should be kept safe and sound, to avoid problems and delays when you come to sell your house.
And if the tradesperson didn’t give you the right paperwork, it makes sense to track down what you can before you get too far along the sale process. 
Any work involving electricity or gas should be carried out by someone who is suitably qualified and they should certify that the work has been properly carried out in accordance with applicable regulations.  New windows should have a FENSA certificate.
Internal modifications may need building regulations consent and, when the work is complete, you will need a certificate confirming that those regulations have been satisfied, together with any planning permission, if that was also required.
It is down to the householder to make sure these documents are provided, although it can mean having to be firm if a tradesperson treats such paperwork as of secondary importance, especially once the work is complete and they have been paid.
Old deeds and conveyancing documents may also be important. Although most properties are now registered at the Land Registry and the owner’s title consists of an electronic entry held by the Land Registry, the old deeds may contain information that does not appear in the Land Registry records. For example, the Land Registry title may state that a property is subject to certain rights or undertakings - known as covenants - but the record may not include the details about what exactly those rights or covenants are, and the only way of finding out is by referring to the old deeds.
Property Law expert  and Head of Residential Conveyancing John Appleton commented:  “It’s well known that moving home is one of the most stressful events in life, even if it all goes smoothly.  If you haven’t got the right records and certificates, it’s bound to cause delay and in the worst case scenario it could lead to a buyer backing out.  When you’re planning any work in the house beyond simply decorating, it really makes sense to check out your responsibilities as a homeowner - you need to know what paperwork your tradesperson is supposed to provide and then make sure that they do what is required.”
ENDS

Web site content note: 

This is not legal advice; it is intended to provide information of general interest about current legal issues.

Moving Home Testimonial

Moving Home Testimonial

I have used Breeze & Wyles on a number of occasions over the last 30 years in the buying and selling of property. The service you provided on this occasion was as good as ever and I will continue to use your services in the future.

I was so happy with your service. I would recommend you highly to any family or friends in need of a solicitor. Thank you very much for helping get my first house.


Nationwide cuts fixed and tracker rates

With effect from Friday 6 November 2009, Nationwide is cutting its rates on selected fixed-rates and tracker mortgages.

Purchases:
Two year fixed rate available from 3.78% (up to 70% LTV) and two year tracker available from 2.78% (up to 70% LTV)
New customers can borrow up to 85% LTV
Existing borrowers who are moving home can borrow up to 95% LTV
£99 booking fee (payable upfront and non-refundable)
£896 reservation fee

Two year fixed rate available from 3.88% (up to 70% LTV) and two year tracker available from 2.99% (up to 70% LTV)

New customers can borrow up to 85% LTV
Existing borrowers who are moving home can borrow up to 95% LTV
£99 booking fee (payable upfront and non-refundable)
£396 reservation fee

Remortgages:
Two year fixed rate available from 4.37% (up to 60% LTV) and two year tracker available from 3.48% (up to 60% LTV)
New customers can borrow up to 85% LTV on the fixed rate and up to 75% on the tracker rate
£99 booking fee (payable upfront and non-refundable)
£396 reservation fee

Two year fixed rate available from 4.87% (up to 60% LTV)
New customers can borrow up to 85% LTV
£99 booking fee (payable upfront and non-refundable)
No reservation fee