A chance for young Londoners
Use the Budget stamp duty tax break to get on the ladder at last, says
FIRST-TIME buyers were hitting their search buttons the moment the Budget announcement on stamp duty savings came through. Estate agents and developers across the capital have reported a surge in activity as Londoners, forced to pay more for homes than the rest of the country, reckon they stand to benefit most.
One way of making the most of this tax break on property valued above the new £300,000 threshold is to buy into a shared-ownership home. You pay duty only on the share you buy, not the full value of the property. So if you buy 50 per cent, paying say, £285,000 for a home priced at £570,000, no stamp duty will be due.
Only when you “staircase”, buying more shares that take you above 80 per cent of the property’s value, must you pay extra stamp duty, and even then only on the transaction amount that takes you over the 80 per cent threshold. This applies to any subsequent shares you buy. Shared ownership also requires a much lower deposit than the £100,000 typically demanded from London first-time buyers, which is often only scraped together with the help of parents — so the Budget will have drawn sighs of relief all round.
GETTING ON TO THE SHARED- OWNERSHIP LADDER
Good-quality shared-ownership homes are available at fashionable riverside schemes and glam new skyscrapers in posh postcodes, not just in up-and-coming, grittier parts of inner London and suburban high streets.
Register at sharetobuy.com/firststeps so you can search not just by area, but by the deposit and budget you can afford. Thousands of homes are listed on the website and new schemes are added regularly. Some homes are available off-plan, usually several months before they are completed, letting buyers organise their move.
STAMP OF APPROVAL FROM LONDONERS
Before the Budget, stamp duty kicked in at two per cent for homes worth £125,000-plus, and five per cent for the £250,000£500,000 band. The average London first-time buyer spends £409,795, according to Halifax bank, meaning the first-time buyer exemption from stamp duty means a potential saving of £5,000.
Only about a third of properties on the market in London are below the £500,000 level, whereas in the rest of the country the proportion is roughly two thirds.
Because Londoners pay higher prices for
buying “off-plan” gives time to arrange your move their homes, some developers and housing associations offer to pay the stamp duty as an incentive to buy. Clarion Housing Group is offering to pay all the stamp duty at its Banbury Park scheme in Walthamstow where twobedroom flats cost from £400,000. Call 020 8523 3294. The Government’s low-deposit Help to Buy scheme is also available there.
“It’s an early Christmas present for buyers,” says marketing director Tim Seward. “First-time buyers won’t have to pay a penny in stamp duty.”
FROM UP-AND- COMING DOCKLANDS TO HIP SHOREDITCH
Stamp duty-free homes have been launched by Notting Hill Housing at several sharedownership developments in Docklands. At Traders’ Quarter, Royal Docks, prices start at £96,250 for a 25 per cent share of a onebedroom apartment priced at £385,000. At Rathbone Market, Canning Town, prices start at £85,000 for a 25 per cent share of a £340,000 flat. At Royal Albert Dock, prices start at £107,500 for a 25 per cent share of a flat with a full price of £430,000. Homes at Alder Grove and Parkside Place in Wembley have also been unveiled. Prices start from £134,000 for a 40 per cent share (full price £335,000). For all of the above, call 020 3797 8481 for details. In addition to stamp duty savings, shared ownership allows buyers to live in a popular location that would otherwise be beyond their budget. At Godfrey Place in Shoreditch, Genesis is selling flats from £162,500 for a 25 per cent share of a home with a full price of £650,000. Call 020 3813 5239. And at Jubilee Place, Queen’s Park, prices start at £152,500 for a 25 per cent share. Call 020 3432 0746.
From £162,500: for 25 per cent of a two-bedroom £650,000 flat at Godfrey Place in the heart of trendy Shoreditch. Call Genesis on 020 3813 5239 From £96,250: for 25 per cent of a one-bedroom £385,000 flat at Traders’ Quarter in Royal Docks, E16. Call Notting Hill Housing on 020 3797 8481