Critchley Hall News
Stamp Duty Exemption Deadline - 31st December 2009
On 31 December 2009 the threshold of 1% stamp duty will be reduced from £175,000 back to the previous £125,000 threshold. If you are looking to buy and have made an offer then it makes sense to push the completion through before 31 December.
But what if you are only thinking about buying? If you have not found a property you want to buy then you may want to wait before committing to a purchase just to make a “potential” 1% saving on Stamp Duty, and here is why.
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In the current market it is much easier to negotiate a discount, just a 1% discount will offset the savings in Stamp Duty, so maybe the emphasis should be on negotiating the best possible price. It is likely that a vendor may hold out for a higher price and use the 31 December to help negotiate this … e.g. if you pay their price they will do everything possible to support completion before 31 December.
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Property prices are still volatile, some analysts are suggesting prices might fall back over the winter, thus more than compensating for the 1% saving in Stamp Duty. Clearly however property prices changes vary throughout the UK, you need to understand your local market.
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Purchasing a property is a huge financial commitment, rushing to purchase in order to save 1% Stamp Duty could actually result in a purchase you were not 100% committed to.
In conclusion, if you have found the property you want and agreed the price then do everything possible to complete and save on Stamp Duty. If you have not yet found a property then it is unlikely that you can complete in time (solicitors offices often close for 1 to 2 weeks over Christmas), you are better off taking your time to find the right property at the right price.