SDLT: It’s beginning to look like Christmas, everywhere you go!
Waxy advent chocolate is being eaten daily, buskers are playing all variations of Christmas carols (apparently) and Christmas decorations are all around us. The festive season cannot be ignored: and as soon as you switch on the news… Stamp duty land tax news litters your screens, in what could only be described as taxation porn.
In case you have been living in a cave for the past couple of days, or have only now dared to emerge from the Black Friday chaos; George Osborne’s latest tax reform attacked what has often been described as the “worst tax in Britain.”
There is a lot of noise about how SDLT will affect the property market. The obvious conclusion that anyone could draw is that the properties that would naturally fall around the “steps” in value (£250,000, or £500, 000 for example) can now be accurately priced, whether over inflated, or under valued; the price can now reflect the true market. Few would consider market efficiency a bad outcome of any investment market.
Increasing taxation in the prime property markets is having a strong impact according to the Telegraph’s article today. The assumption is that market prices are now being “slashed” as the total outlay for the buyer is now higher when factoring the increased SDLT duties. One of the concerns is that such properties tend to be located in London, where the property market attracts a large amount of investment from overseas, which helps to balance the GDP. The concern associated with this assumed reduction in investment, is that it could undermine Osborne’s economic policy. In reality, considering the reputation of the London property market, and how fractional these increases are (proportionate to the amounts of money being invested), many would consider that such headlines are a little more dramatic than the reality.
The only certain effect of the SDLT review, is that we at CrowdLords have had to adjust our financial model to accommodate the new regulations.
Is this the government’s Christmas present for first time buyers, or is it the fairy on the tree for the taxman (and the lump of coal for the wealthier property purchaser)? You decide!
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