Cutting stamp duty for first time buyers purchasing a property up to £250,000, is expected to cost the Treasury £520 million over the period of the waiver, and from next year those looking to buy at over £1 million will be helping to recoup that loss.
From 6th April 2011 the rate of stamp duty on properties purchased for £1 million+ will increase from 4% to 5%, increasing borrowers’ costs by at least £10,000.
Unlike the “holiday for first time buyers which ends on 24th March 2012, the Chancellor didn’t give a date when the 1% increase might end, so it’s fair to assume that unless we have a change of Government, it’s here to stay.
As the property market recovers, and the April deadline draws nearer we are likely to see an increase in the number of £1 million+ transactions as buyers try to beat the new 5% deadline.
The latest figures from the Land Registry show that in November last year 480 homes in England and Wales sold for more than £1m.