In July 2020 the Chancellor announced that the nil rate band for stamp duty land tax would increase to £500,000, meaning homeowners purchasing property for less than this would have to pay no SDLT at all until 31 March 2021. PWW reported on the changes at the time and you can read our article here.

The good news for those with ongoing property purchases is the announcement by the government on 3 March that the deadline for the change to the nil rate band has been extended until 30 June 2021. Between 31 March 2021 and 30 June 2021, if you purchase a residential property, you will only pay SDLT on the amount that you pay for the property above £500,000.

The increase in the nil rate band applies to first time buyers and those who have purchased property before, as well as companies buying residential property. People purchasing second homes or as buy-to-let will still have to pay the additional 3% SDLT surcharge, but will also benefit from the increased nil rate band, paying just 3% up to £500,000.  

The Chancellor also announced that, from 1 July 2021 until 30 September 2021, those purchasing property will only pay SDLT on property prices above £250,000. Whilst this is lower than the current nil rate band of £500,000, it is still higher than the pre-July 2020 nil rate band of £125,000, and will stand to benefit property buyers during this period.

The pre-July 2020 nil rate band of £125,000 will then apply to all property purchases from 1 October 2021. 

The Chancellor also announced on 3 March a government-backed mortgage scheme put together to assist homebuyers buying properties worth up to £600,000. Under the scheme, the government will guarantee the loans of homebuyers who only have a 5% deposit. Previously these buyers have been priced out of the mortgage market. The hope is that, with the added comfort of a government guarantee, lenders will be encouraged to lend 95% mortgages, and these will be available to all buyers, not just first time buyers.

The scheme will run until late 2022, and major high street lenders like Lloyds, NatWest, Santander, Barclays and HSBC have already signed up.

PWW have an active residential property team who are ready to assist with all of your conveyancing needs. Please do not hesitate to contact our conveyancing team by clicking here. You can read more about our residential property services here and check our conveyancing fee scale here.

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