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NEWS: UK House Sales Fall Following End of Stamp Duty Holiday
On 1st October this year, the government’s Stamp Duty holiday came to an end.
And as a result, HMRC has reported that a massive 52% fewer houses were sold in the UK in October compared to September.
But while a drop of 52% is extraordinary, it’s not necessarily a sign that people have stopped buying houses - the percentage is exaggerated by an inflated number of sales in September due to buyers squeezing in their property purchases before the tax holiday ended.
It’s less a case of: nobody is buying property right now.
And more a case of: lots of people were buying property in September.
For example, when you instead compare the house sale figures from October 2021 to October 2020, it’s a drop of just 28.2%.
Still significant, but it puts the figures into perspective. And looking at September’s numbers more closely gives us the bigger picture.
September 2021’s house sale figures were a whopping 68.4% higher than in September 2020, and were 67.5% higher than August 2021’s numbers.
This shows that the reported drop in October is more to do with a surge in September than anything else.
And it highlights how significant the tax saving incentive was for property buyers who were able to save thousands on their stamp duty bill during the holiday period.
What are the current Stamp Duty Tax Rates?
Since 1st October, the Stamp Duty Tax rates are as follows.
Current Stamp Duty Tax Thresholds for England & Northern Ireland:
| Purchase Price | Stamp Duty Tax Rate | Stamp Duty Tax Rate for an Additional Property |
|---|---|---|
| Up to £125,000 | 0% | 3% |
| £125,001 to £250,000 | 2% | 5% |
| £250,001 to £950,000 | 5% | 8% |
| £950,001 to £1.5m | 10% | 13% |
| Over £1.5m | 12% | 15% |
Compared to the rates prior to the end of the Stamp Duty Tax holiday in October 2021, the tax-free allowance has halved from £250,000 to £125,000.
Related: What Stamp Duty do I Need to Pay and can my Mortgage be Used to Cover it?
Give us a call
A Mortgage Broker can talk you through the best options for what type of mortgage to take out, including helping with how to raise funds for your Stamp Duty Tax.
At Clifton Private Finance, we can advise on the best approach for your deposit and tax strategy, and find the mortgage that makes the most sense for you.
Contact us to arrange a convenient time for an in-depth first discussion with one of our trusted finance brokers and see how we can help:
0117 959 5094
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