First-time buyers who have completed their sale before the stamp duty deadline have spoken of their relief, with one describing how the potential extra cost could have been a “deal breaker”.
Under the changes, from April 1, first-time buyers will pay no stamp duty up to £300,000 and 5% on any portion from £300,001 to £500,000. If the price is over £500,000, they must follow the rules for people who have bought a home before.
Up until March 31, first-time buyers pay no stamp duty up to £425,000 and 5% on any portion from £425,001 to £625,000. If the price is over £625,000, they cannot claim the relief.
First-time buyer Jenny Lianos, 32, recently completed on a one-bedroom flat in Chiswick, London.
She said: “I put the offer in January, and since then it’s been a race to complete ahead of the stamp duty deadline. I paid £525,000 for the property and knew from the outset that stamp duty could be a deal breaker.
“Completing the sale in March meant that I paid £5,000, however, if this had been pushed into April, I’d have had to pay £16,250.
“Frankly, that was over £11,000 I didn’t have. It means there has been a huge amount of pressure on my solicitor and broker to get everything sorted.
“Thankfully everyone has been understanding of the situation, and I was able to get my keys in plenty of time.”
For Dan Barker, 29, a Lifetime Isa (Lisa) was crucial in helping him onto the property ladder.
He told how he used a Lisa from provider OneFamily to help buy his flat in Bristol in November last year.
Mr Barker started to save into a Lisa in 2019, saying his mother had encouraged him and his brothers to open accounts “as it offers a ‘free’ 25% on anything you save up to £4,000 per year”.
Mr Barker, who grew up in Swansea and works in Bath, had set himself a deposit goal of £30,000 and went on to buy his flat for £280,000.
That price would still be under the new £300,000 stamp duty “nil rate” threshold – although property values often increase over time and Mr Barker has also been upgrading his home since he bought it by carrying out renovations.
Mr Barker added: “With the bonus and increase in value from the stock market combined, by the time I bought my flat the total value was £32,500 – so I’d received an extra £11,450.”
He added: “I bought by myself which can make it really difficult to afford, but the extra money I received by investing into a Lisa made it possible.
“It wouldn’t have happened otherwise, or I would’ve had to buy a property that required a lot more work or wouldn’t have been able to get the location I’ve got. The extra bonus and growth allowed me to get exactly what I want.”
