ONE of Hereford’s leading Estate Agents, Andrew Morris of Bridge Street Hereford comments on the stamp duty reform announced as part of the Chancellor’s Autumn Statement.

“It really is an early Christmas present for the buying public, the structure, rates and thresholds have been changed to deliver a more efficient and fairer system” as he explains. “The cumulative slab structure has been scrapped in favour of a gradual band tax, applied like income tax. There will still be no tax on purchases up to £125,000. Above that there will be several bands:

Between £125,001 and £250,000 the rate will be 2%.

Between £250,001 and £925,000 the rate will be 5%.

Between £925,001 and £1.5m the rate will be 10%.

Above £1.5m the rate will be 12%.

So, on a £180,000 house purchase there will be no tax to pay on the first £125,000, then 2% on the remaining £55,000, which is a total bill of £1,100, versus £1,800 before the changes. On a £300,000 house purchase there would be no tax to pay on the first £125,000, then 2% on the next £125,000 (£2,500) and 5% on the last £50,000 (£2,500). That’s a total £5,000 compared with £9,000 under the previous system.”

Andrew continues, “It gives a great confidence boost for the long term strategy of the property market. It should see an upturn in purchasing, particularly in the £250-300,000 bracket where the stamp duty threshold was really a sticking point and had made this section of the market quieter for the last few years, whilst there is considerable saving in the volume market between £125-250,000. The changes will help many first time buyers to get on the property ladder too. This gives us a positive outlook as we step into 2015, it really should be a happy new year!”