AUTUMN Budget and property overview

Further to the recent budget announcement we understand that some decisions are disappointing to those who were considering investment in the buy to let market or looking for a second home. However, it was positive to note that the government’s office for budget believes there will be growth in the economy over the next three years. There was also enthusiasm towards building new homes, which are needed for our ever-growing population and that our NHS services will receive much more needed financial support.

In the meantime, it is possible for home movers and first-time buyers to make some savings if they complete a property purchase before the 31^st of March 2025.

Like all home movers we are currently talking to, I’m sure you are eager to find your next home to save money. We are proud to share with you some lovely listings we currently have available. Click here to arrange a viewing:

Should you be looking to sell a property in the area you can arrange for our friendly team to visit you at your home.  Book here for your FREE market appraisal

For a general estimate, before booking with an agent, you can use our online valuation tool. CLICK HERE

In general, for the housing sector the government confirmed the following:

• The current affordable homes budget, which runs until 2026, boosted by £500m.

• Stamp duty surcharge, paid on second home purchases in England and Northern Ireland, to go up from 3% to 5%. These changes took effect on 31 October 2024, and property buyers will need to consider these updates as they plan their transactions: Second Homes, Buy-to-Let, and Company Purchases.
• Now, buyers of homes worth less than £250,000 don’t pay stamp duty. This was doubled from £125,000 in the September 2022 mini-Budget. The threshold is £425,000 for those buying their first property. This was raised from £300,000 as part of the mini-Budget. These higher thresholds will end on the 31st March 2025, when they are expected to revert to previous levels from the 1^st April 2025. Shown below is a table showing rates now and when the new stamp duty rates apply.

 CURRENT STAMP DUTY RATES

First time buyers – No stamp duty payable up to £425,000

Property or lease premium or transfer value                                                                                         SDLT rate

Example

In November 2024 you buy a house for £300,000 and are not a first-time buyer. The SDLT you owe will be calculated as follows:

• 0% on the first £250,000 = £0
• 5% on the final £50,000 = £2,500
• total SDLT = £2,500

Example

In May 2025 you buy a house for £300,000 and are not a first-time buyer. The SDLT you owe will be calculated as follows:

• 0% on the first £125,000 = £0
• 2% on the £125,000 =         £2,500
• 5% on the final £50,000 =  £2,500
• total SDLT =                          £5,000

When we look at the calculation difference at a purchase price of £700,000 the increase next year is not as substantially different to the lower price ranges. For example, in November 2024, you purchase a property for £700,000 (Not first time buy, second home or investment) your stamp duty would be equal to £22,500. If you complete the purchase after the 31^st of March 2025, the stamp duty will be £24,500. A £2,000 increase.

• The single rate of stamp duty charged when firms buy dwellings worth more than £500,000 will also increase from 15% to 17%.

• You can calculate any stamp duty liability by using our online stamp duty calculator.

 Other matters included in the budget:

Business taxes

• Companies to pay National Insurance on workers’ earnings above £5,000 from April, down from £9,100 currently, with the rate increasing from 13.8% to 15%.
• Employment allowance – which allows companies to reduce their NI liability – to increase from £5,000 to £10,500

Personal taxes

• Freeze on income tax and National Insurance thresholds to end in 2028, to stop people being put into higher tax bands as their wages rise.
• Capital gains tax paid on profits from selling shares to increase from 20% to 24% – rates on additional property sales to stay the same.
• Freezing inheritance tax thresholds extended to 2030.

• Tax paid by private equity managers on share of profits from successful deals to rise from up to 28% to up to 32% from April.
• Main rate of corporation tax, paid by businesses on taxable profits over £250,000, to stay at 25% until next election.

Transport, alcohol, tobacco

• £2 cap on single bus fares in England is going up to £3.00 from January 2025.
• 5p cut to fuel duty on petrol and diesel, due to end in April 2025, kept for another year.
• Commitment to fund tunnelling work to take HS2 high-speed rail line to Euston station in central London.
• Commitment to deliver upgrade to trans-Pennine rail line between York and Manchester, running via Leeds and Huddersfield.
• Air Passenger Duty on flights by private jet to go up by 50%.
• Tax on tobacco to increase by 2% above inflation, and 10% above inflation for hand-rolling tobacco.
• Tax on non-draught alcoholic drinks to increase by the higher RPI measure of inflation, but tax on draught drinks cut by 1.7%.

Wages, benefits and pensions

• Legal minimum wage for over-21s will rise in April from £11.44 per hour to £12.21.
• Rate for 18 to 20-year-olds to go up from £8.60 to £10.
• Eligibility widened for the allowance paid to full-time carers, by increasing the maximum earnings threshold from £151 to £195 a week.

UK debt, inflation and economic growing

• Office for Budget Responsibility predicts the UK economy will grow by 1.1% this year, 2% next year, and drop down to 1.8% in 2026.
• Inflation predicted to average 2.5% this year, 2.6% next year, before falling to 2.3% in 2026
• Official definition of UK government debt loosened by including a wider range of financial assets, such as future student loan repayments.

Government spending and public services

• Extra £22.6bn for day-to-day spending on the NHS in England, and a £3.1bn boost to budget for investment.
• £6.7bn allocated for education investment next year, with £1.4bn earmarked for rebuilding over 500 schools.

Disclaimer: Although we have taken time to consider the content of this news article, we cannot guarantee it is accurate and do not take any responsibility for any errors or statements made. We advise that all readers check facts for themselves through professional or governmental channels.