If, like us, you’ve been following the government updates on the property market with bated breath, then you’ll know viewings are returning to normal and there will soon be changes to Land Transaction Tax/Stamp Duty. But, what exactly is changing and what does that mean for you?
We’ve summarised the updates for you below.
What is Changing?
Following the Chancellor of the Exchequer’s recent announcement of changes to Stamp Duty Land Tax, the Welsh Government has now raised the Land Transaction Tax threshold in Wales to £250,000.
Please note: Land Transaction Tax replaced Stamp Duty Land Tax in Wales back in 2018. Read about it here.
The hike has not been as high as seen in England and Northern Ireland – where Rishi Sunak announced the limit there would be raised from £125,000 to £500,000. But, with the average property price in Wales being just over £190,000, the tax changes will reduce the price of buying a home for many people across the principality.
Finance Minister Rebecca Evans said:
“It will support people looking to purchase their first home or those seeking to move up the property ladder. So, it will offer more targeted help to those who may be affected by the economic challenges resulting from the pandemic.
"The new threshold will mean that no tax will be paid on around 80% of transactions in Wales where the main residential rates apply. With a higher threshold for starting to pay tax, those purchasing more expensive properties will still pay less – where the home is bought for them to live in.”
The new rate will come into force on July 27th, the same date of the full reopening of the housing market in Wales, when the viewing of occupied properties will be allowed to recommence. It will end on March 31st 2021.
However, please be aware, this does not apply to the purchase of additional properties such as buy-to-lets or second homes like in England.
What Effect Do We Expect These Changes to Have?
The Government hopes the tax holiday will help to get the property market moving in Wales again following the Coronavirus crisis. The wider economy will hopefully benefit too as new home owners will seek to do renovations or purchase new furniture.
And, we think they’re right. Our conveyancing solicitors are already seeing a rise in calls as sales begin to pick up once again, and property experts are reporting long waiting lists for property viewings as many put moving plans on hold during the lockdown.
As Williams and Goodwin estate agent Tim Goodwin recently told Wales Online:
‘[There are] unprecedented waiting lists for parties wishing to view occupied properties once access for physical viewings is allowed. […] The market is showing strong signs of activity but difficult to establish if this is catching up with the backlog following lockdown, or likely to be a sustained trend as properties coming new to the market are often generating interest from more than one party, and are selling quickly.’
Moving Home Soon?
Whether you’re buying, selling, or both, if you’re moving home soon, you need a conveyancer you can trust. Howells Solicitors is one of the leading conveyancing law firms in Wales and multi award-winning, so you’re safe in our hands.
Get in touch with our conveyancing team today to see how we can help with your move.