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By Kush Rawal, Director of Residential Investment from Metropolitan Thames Valley Housing.
We welcome the Chancellor Rishi Sunak’s announcement of the removal of stamp duty for homes up to £500k, until March 2021.
It’s superb news for so many: from those looking to buy their first home, those who’ve outgrown their property and those looking to downsize.
For the first time in over a decade, the housing market will be able to move more freely as stamp duty barriers are removed.
And this announcement means so much more to the shared ownership market.
We have long said shared ownership helps provide homes for all, but the removal of stamp duty further enhances this, and allows our clients to not just buy a portion of their home, but secure their future long term when they “staircase”, as in many cases they will be removed from stamp duty all together.
Saving for a home can take the best part of a decade, and the minimum deposit to buy a house outright is 5%; according to the HPI, the average home costs £231,185 with a deposit being a minimum of just over £11,500.
Giving people an affordable route to home ownership has never been more important. We know incomes have taken a hit due to the pandemic and the economic challenges ahead will mean that saving up large deposits to buy a home is going to be even harder and more daunting than ever before.
Shared ownership offers an alternative to this, as home owners can buy a portion of the property, and staircase. However, it has been the case that each time they buy another portion they’ve had to pay stamp duty costs, so this has actively been disincentivising our customers to full ownership.
Times have been tough, and in many cases people have had to use their savings to survive during lockdown.
This has particularly impacted key workers during the crisis, but the Chancellor's announcement means teachers, nurses, police staff and many others will be able to buy a shared ownership property with less than two months’ rent, and long term they will be rewarded by scaling to full ownership without paying stamp duty.
This is a homes for all announcement, and we look forward to helping our customers secure their futures with solid foundations.