Builders have moved fast to soften the blow of George Osborne’s surprise stamp duty hike. Buyers already facing punitive rates of stamp duty for higher-priced properties will, from April, have to find a further three per cent if they are purchasing a second home. However, some developers have stepped in, offering to pay so-called “transaction taxes” in an attempt to keep the market buoyant.
Compared with a year ago, property transactions are down in 31 out of 32 London boroughs — the exception being Barking & Dagenham. Homes in the price-sensitive £1 million to £2 million bracket have been hit hardest, according to property data firm LonRes, which reveals that 22.5 per cent fewer homes in this range changed hands in London during the three months to September.
Buyers of homes worth below £937,500 pay less stamp duty than before, but buyers of more expensive properties pay a lot more. This has hit London particularly hard, because properties here cost so much more.
Stamp duty rates
|Homes priced up to £125,000||0 per cent|
|From £125,001 to £250,000||2 per cent|
|From £250,001 to £925,000||5 per cent|
|From £925,001 to £1.5 million||10 per cent|
|Homes more than £1.5 million||12 per cent|
Where you can save
Discover the new homes with stamp duty incentives
Discover the new homes with stamp duty incentives
1/19 Fulham Riverside
From £765,000: a redevelopment of former Kops Brewery, Fulham Riverside has stamp duty savings of up to £36,750 are available. Call 0844 811 4334.
2/19 Parkside Place
From £750,000: save up to £51,250 on stamp duty deals at Linden Homes’ Parkside Place in west Hammersmith (scroll right...)
3/19 Parkside Place
From £750,000: two-bedrooms flats are set in a leafy corner of the borough with pockets of charming Regency and Victorian villas and terraces plus a pretty square that opens on to the park. Call 020 8003 7976
4/19 The Villas
From £1,295,000: a courtyard scheme of eight clean-cut, contemporary-design townhouses in Goldney Road, Maida Vale (scroll right...)
5/19 The Villas
From £1,295,000: homes at The Villas feature open-plan interiors and large roof terraces (scroll right...)
6/19 The Villas
Save up to £29,258: on The Villas, Maida Vale, with cleancut courtyard homes from £1,295,000. Call 020 7724 4724
7/19 More West
From £707,500: a new build scheme of apartments and houses in Freston Road, W10 (scroll right...)
8/19 More West
From £707,500: solid-looking and sensitively-designed to reduce noise, the architecture takes into account the gritty urban streetscape and the close proximity to Latimer Road Tube (scroll right...)
9/19 More West
From £707,500: homes at More West have stamp duty savings of up to £27,500. Call 020 7758 8431.
10/19 Century Gate
£870,000: next to Kent Country Cricket Club, Century Gate in Beckhenham has one house left for sale with a stamp duty saving of £34,000. Call 020 8712 3995
11/19 Edgware Green
From £670,000: ideal for “next steppers”, these four-bedroom houses at Edgware Green are aimed at growing young families and come with up to 3 per cent stamp duty paid. Call 0844 811 4334
12/19 Greenwich Square
From £825,000: a hospital redevelopment at Greenwich Square, where developer Hadley Mace is paying stamp duty on townhouses (scroll right...)
13/19 Greenwich Square
Priced from £825,000 stamp duty savings at Greenwich Square are worth at least £31,250. Call 0800 077 8122.
14/19 Waterside Park
From £362,000: one-bedroom flats come with stamp duty paid. Call 0844 811 4334.
15/19 Asquith Spencer Park
Situated in Wandsworth, each house in Spencer Park has over 4,500 sq ft of living space (scroll right...)
16/19 Asquith Spencer Park
Each house has private gated access from the rear garden into the hidden communal garden of Spencer Park (scroll right...)
17/19 Asquith Spencer Park
Homes at Spencer Park have up to 50% off stamp duty until December 31. Call 020 8877 1222
18/19 Smithfield Square
A collection of one- and two-bedroom flats and luxury suites in Hornsey High Street (scroll right...)
19/19 Smithfield Square
Close to Crouch End, Muswell Hill and Alexandra Palace, apartments benefit from concierge service, gym, underground parking and private gardens. Call 020 3002 9460 for stamp duty offers.
At Fulham Riverside, a redevelopment of the former Kops Brewery, stamp duty savings of up to £36,750 are available on flats priced from £765,000. Call Barratt on 0844 811 4334. And there are plenty more such deals.
The Royal Borough of Kensington & Chelsea extends west to the railway tracks of White City. This is the cheapest pocket of the cheapest part of the borough. The adjacent area is poised for an exciting future, with the transformation of old industrial estates into landscaped pedestrian links providing quick access to the gleaming new White City neighbourhood.
More West in Freston Road is a new-build scheme of apartments and houses in the W10 postcode it shares with Ladbroke Grove. Solid-looking and sensitively designed to reduce noise, the architecture takes into account the gritty urban streetscape and the close proximity to Latimer Road Tube station. Prices from £707,500, with stamp duty savings of up to £27,500. Call 020 7758 8431.
The west side of Hammersmith’s Ravenscourt Park is a leafy corner of the borough, with pockets of charming Regency and Victorian villas and terraces, plus a pretty square that opens on to the park. Parkside Place, opposite the park, is a development of two-bedroom flats priced from £750,000 that come with stamp duty savings worth up to £51,250. Call Linden Homes on 020 8003 7976.
Homes with giveaways
The Villas, Maida Vale, is a courtyard scheme of eight clean-cut, contemporary-design townhouses with open-plan interiors and large roof terraces. Prices from £1,295,000, with stamp duty savings of up to £29,258. Call Aston Chase on 020 7724 4724.
At Greenwich Square in SE10, a former hospital site, developer Hadley Mace is paying stamp duty on townhouses priced from £825,000, worth at least £31,250. Call 0800 077 8122. Four-bedroom houses cost from £670,000 at Edgware Green, HA8, where stamp duty up to three per cent will be paid, and at Waterside Park in Docklands, one-bedroom flats priced from £362,000 come with stamp duty paid. Call 0844 811 4334.
Century Gate in Beckenham is a scheme of detached family houses next to the grounds of Kent County Cricket Club. The last house for sale, at £870,000, comes with a stamp duty saving of £34,000. Call 020 8712 3995.
Avoid the surcharge for second homes
Changes announced in the Autumn Statement mean anyone buying a second home or a buy-to-let property will have to pay three per cent on top of the standard stamp duty. A shocked property industry fears a collapse in sales, which is why developers are creating incentives.
The three per cent surcharge can be avoided if you exchange contracts and complete the purchase before April next year. For “off-plan” purchases where completion is due after April, it is worth haggling with a developer to get a deal to cover all or part of this surcharge.
You will not have to pay the three per cent surcharge if you purchased off-plan and exchanged contracts prior to last month’s Autumn Statement and will complete later than April.
But if you buy a new home for your main residence, and keep your existing property, you will still have to pay the surcharge.
When you sell an investment property, you can deduct the stamp duty paid at the outset from any capital gains tax due.
The Treasury has yet to clarify grey areas, such as the tax treatment of people who temporarily own two properties because they are bridging, or unmarried couples who buy a second home or investment property.