HOME movers will make the most significant saving from The Chancellor’s stamp duty change announced today, says Rebecca Postles, head of Savills Knutsford.

Chancellor Rishi Sunak announced a temporary increase until March 31, 2021, on the stamp duty threshold to £500,000 for property sales in England and Northern Ireland.

Analysis from property advisers Savills shows the stamp duty holiday could save home buyers in England up to £15,000.

The price threshold at which buyers start to pay stamp duty is now £500,000, up from £125,000.

Rebecca said: “That means someone buying the average home in England, worth £248,000, would pay no stamp duty at all, a saving of £2,460. Someone buying a £500,000 property would save the maximum £15,000.

“While properties over £500,000 will pay stamp duty, they’ll pay £15,000 less than before.

“This will bring the stamp duty bill for a £1 million home from £43,750 down to £28,750, a saving of around a third.”

Savills analysis of Land Registry data suggests under 90 per cent of home sales in England are below £500,000, and would not pay any basic stamp duty.

That proportion is highest in the north east, where 97 per cent of transactions fall beneath the new threshold.

Knutsford Guardian:

Andrew Thorpe, head of Savills Wilmslow

There are three local authorities with no sales above £500,000 at all in the past year; Copeland, Kingston upon Hull, and Barrow in Furness.

Rebecca added: “The most significant saving is for home movers, as first-time buyers already have tax relief if they buy a property worth less than £500,000.

“There were 289,000 mortgaged home movers in 2019/20, according to UK Finance data.”

Andrew Thorpe, head of Savills Wilmslow, said first-time buyers would still benefit even if they had relief from much of this tax already.

He said: “More movement among home movers and downsizers will free up much-needed housing stock, so there’ll be more homes available for first-time buyers to move into.

“Lifting the barriers to moving home will unlock more transactions.

“That means households can move to areas with stronger, more productive employment markets, which will help the economic recovery.

“It also means we can expect more spending on removals, furniture, and decorating, all of which will help boost the economy further.

“Investors and second home buyers will still have to pay the Higher Rate for Additional Dwellings, which is three per cent of the property value.

“However, these buyers still benefit from the higher nil rate for basic stamp duty.

“Someone buying a second home worth £500,000 would pay £15,000 in stamp duty, half the £30,000 bill they would have paid before today.”