A new budget for Autumn 2018 was recently announced by chancellor Philip Hammond. He declared that austerity was ending, and the nation had begun a journey toward recovery. Below are some of the key things as they pertain to housing.
Stamp Duty Exemption
In the wake of new policymaking as it concerns housing, much-needed reliefs and exemptions on stamp duty have been instated. The initial practice was to pay stamp duty also known as Stamp Duty Land Tax (SDLT) on property (home) purchases costing more than £125,000. However, all that has changed with the new SDLT reliefs and exemptions.
The interesting and probably the most beneficial clause to this new stamp duty edict is the exemption on purchasing homes as accustomed to first-time buyers. It states that first time home purchases in England and Northern Ireland, will not require SLDT for homes costing less than £300,000. This means homes which cost higher than the amount stated earlier, will require a first-time buyer to only pay stamp duty for the cost of the property after deducting the initial £300,000.
Nonetheless, if the first time buyers belong to a shared ownership agenda, then they can be listed under first time buyers. Under these circumstances, they are allowed the privilege of stamp duty exemption for properties costing not more than £500,000. However, this only applies to purchases made from the date of the last budget, the 22nd of November, 2017.
Extending Help To Buy
For a while now, the Help To Buy: Equity Loan scheme has been one of the government’s best practices in aiding aspiring homeowners. Hence it comes as a bundle of good news to have the loan program extended to the year 2023.
However, it will now be solely reserved for first-time homeowners. With property purchase up to 1.5 times the average first-time buyer house price in each region, this ensures the scheme attends to those in dire need of the loan, with only a £600,000 cap in the London metropolis.
Changes For Landlords
One of the classes of people most affected by taxation changes has been landlords. Scrapping tax relief for mortgage interest payments in recent years have dealt sorely with them. However, the budget for 2018 has been hailed for easing off the reins that previously latched on tightly to the private rented sector.
Nonetheless, reduced lettings relief is said to be taking a slight readjustment from April 2020 on Capital Gains Tax. This means that it will now be limited to properties where occupancy is shared between the owner and tenant. This is in order to solve the issue around ownership owed from letting a property, and thence becoming ‘accidental landlords’.
Funding for Affordable Homes
Housing associations are expected to receive a whopping £2 billion from the Affordable Home Programme. The announcement came from the chancellor who was optimistic that the scheme will help solve the shortage in housing.
Amongst all the recent changes, this is probably the most crucial to the common man. The new income tax personal allowance is being appraised at as much as £12,500, with the higher rate threshold to rise from £46,350 to £50,000. The recently announced changes are billed to kick off from the month of April 2019.
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