House buyers save thousands on stamp duty as chancellor announces tax holiday

Rishi Sunak making his announcement to the House of Commons. Pic: PA/Jessica Taylor

Rishi Sunak making his announcement to the House of Commons. Pic: PA/Jessica Taylor - Credit: PA

Estate agents in Norfolk have welcomed the chancellor’s temporary cut on stamp duty on main homes for sale for up to £500,000.

Rishi Sunak’s announcement in the House of Commons aimed at second steppers moving house temporarily scraps stamp duty paid on properties purchased up to the value of half a million.

Previously home buyers paid nothing up to £125,000 then 2pc up to £250,000 and 5pc on the next tranche up to £925,000.

For example, stamp duty payable on a house for £275,000 was £3,750 and a buyer would now save this amount.

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The move will save house buyers on average £4,500, the chancellor stated and the temporary cut will come into effect immediately and last until March 31, 2021.

Mr Sunak announced the stamp duty cut saying that “uncertainty abounds in the housing market”. He said people needed confidence to buy and sell and the housing market needed to drive growth. He added that nine out of 10 people buying a main house this year would not have to pay stamp duty.

The news was welcomed locally although agents said it could affect house prices.

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Jan Hytch, chairwoman of the Norwich & District Association of Estate Agents, said: “It’s fabulous for our region as the average house price is well under £500,000 but there are more than 300 properties for sale currently between £500,000-£550,000 so it’s not such good news for them.

“Agents will be scrutinising those valuations as you either want to be for sale for just under the £500,000 or a lot over. But you can buy a huge swathe of property in Norfolk, a lot for your money and now you can buy a little bit more.”

Ms Hytch also expected a surge in transactions going through now with some having delayed exchanges to see what Mr Sunak would announce.

Steve Pymm, owner of Pymm & Co estate agents, said: “It’s great news, it’s the cherry on the top of the cake for us as the market has been stimulated with more poeple wanting to move to Norfolk after coronavirus. But the banks now need to open up lending as you can’t get a 95% mortgage.”