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More than two thirds of buyers in England and Wales will benefit from the stamp duty changes announced last year and it is set to stimulate housing market activity. According to a new analysis of land registry prices by the Nationwide Building Society some 86% of housing transactions in London and the South East should benefit and 85% of transactions in Cardiff North will see a reduction in stamp duty payable. This comes as the slab structure of the tax was completely abolished, with purchasers paying the marginal tax rate on the relevant elements of the purchase price. Overall some 98% of buyers will pay the same or less tax and only those purchasing homes costing between £937,500 and £1 million or more than £1,125,000 are set to pay more. The Nationwide report says that the new marginal SDLT should help to remove the distortions caused by the slab structure, which led to a clustering of transactions. The greatest impact is likely to be for homeowners looking to buy property just above £250,000, who could save around £5,000 in tax or around 2% of the purchase price. Based on 2013/2014 transactions data from the Land Registry, nearly 590,000 purchasers in England and Wales would benefit under the new regime, with an average benefit of around £1,600. The benefits tend to be greater in areas where average house prices are higher and thus a higher proportion of transactions are liable for stamp duty. The report estimates that 86% of transactions in London and the South East regions would benefit from the changes, compared with around 50% across the North East, North West, and Yorkshire and the Humber. A further breakdown of the figures show that only a small number of sales would see people paying more while a large number would see no change. In England and Wales as a whole 71% would benefit, 28% see no difference and 2% would pay more. So, in London 86% would benefit, 7% would see no change and 7% would pay more. In the South East 86% would benefit, 13% would see no change and just 2% would pay more while in the East of England 81% would benefit, 18% see no change and 1% pay more. Elsewhere no one would pay more. In the South West 81% would benefit and 18% would see no difference. In the West Midlands it is 61% and 39%, in the East Midlands 58% and 42%, in Yorkshire and the Humber 53% and 43%, in the North West 51% and 49% and in the North East 45% and 54%. While in Wales it is 53% and 47%. Continue reading →
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