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What do the stamp duty changes mean for first time buyers?

What do the stamp duty changes mean for first time buyers?

Written by: Category: Buying, News December 23, 2017

First time buyers

According to figures provided by Zoopla as of December 2017, the average price paid for property in Manchester in the past 12 months stands at £180,650. This means that the vast majority of first time buyers will be eligible for the stamp duty cut that was introduced in the Autumn Budget. On the surface, this is positive news but what sort of impact can first time buyers expect to receive from this change in policy?

The stamp duty cut is applicable for FIRST TIME BUYERS purchasing property at less than £300,000 so buyers in the majority of areas should be eligible for the exemption. Zoopla lists the average property prices over the past 12 months as £286,275 in Sale; £271,176 in Cheadle and £238,001 in Stockport. Only Altrincham, with an average price of £437,855 is above the first level and even these buyers will be eligible for the second level of tax duty. This is where any first time buyer purchasing property priced between £300,000 and £500,000 will not have to pay stamp duty on the first £300,000.

First time buyers can save more than a £1000 on stamp duty in Manchester

At the average price of property in Manchester, the expected stamp duty is £1,113. When you are buying a home for more than £180,000 and you are committing yourself to a lifetime of mortgage payments, this may not seem like a lot of money in the grand scheme of things. However, the most important aspect about the removal of stamp duty is that removes one up-front cost of buying a home.

It is easy to focus on the purchase price of the home and monthly mortgage payments but there are many fees associated with buying a home. A lot of these fees have to paid up-front and this can impact on the level of deposit a buyer has to offer. Obviously the higher the size of deposit, the more favourable a lender will consider an application. In this regard, the removal of stamp duty for first time buyers could play a big role in helping Manchester buyers get on to the property ladder as it will assist in developing a better deposit.

This move should help buyers with small deposits

Studies indicate that the removal of stamp duty for FIRST TIME BUYERS should help people with a small deposit or who have a low level of income buy property. This is definitely something that will be of interest to the property. Even if, as the Office for Budget Responsibility believes, that house prices will rise due to the abolition of stamp duty for first time buyers, the removal of a major up-front cost should have a positive impact on first time buyers in and around Manchester.

With so many factors influencing the Manchester property market, it is hard to say if one factor will have a notable impact on buyers or not. It is fair to say that the Autumn Budget announcement has sparked debate about what first time buyers need, but there is optimism that support is available.

If you want to keep up to date with news and information about buying property in the south Manchester area, Keep in touch with us.

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