Any one who is contemplating buying their first house or flat should keep in mind that the stamp duty holiday or concession, which may currently apply, is due to expire on 24th March 2012.
The Council of Mortgage Lenders is calling on the government to announce a reprieve to the end of this concession but it would probably be unwise for anyone currently eligible to take a risk in this respect.
One of the points the CML make is that this could cause a ‘spike’ in sales before the March deadline, and a slump afterwards. This has certainly been our experience in the past, although this ‘holiday’ is rather more limited than past stamp duty holidays.
If you are eligible though and wanting to take advantage of this, then you would be wise to be thinking about a purchase now, to avoid getting caught with any last minute rush, and to ensure that the transaction can be completed in time. The usual time scale for a purchase is 6 to 8 weeks, but each transaction varies. If there is any chain involved things can take longer.
The current ‘holiday’ applies to:
• an individual or individuals jointly purchase wholly residential property, and
• if the consideration is more than £125,000 but not more than £250,000, and
• where that individual (or all of them) intends to occupy the property as his/her or their only or main residence and
• that individual (or all of them) has or have not, whether alone or with others, previously acquired a freehold or leasehold interest in residential property in the UK (expect a lease with less than 21 years to run) or an equivalent interest anywhere in the world
• purchases where the completion date is on or before 24 March 2012.
Questions & Answers
Q1. What is a first time buyer?
A. A person who has not acquired a freehold or leasehold interest in residential property in the UK (except a lease with less than 21 years to run) or an equivalent interest anywhere in the world.
Q2. When is the relief available?
A. The relief is available for transactions with an effective date (usually the completion date) on or after 25th March 2010 but before 25th March 2012.
Q3. I want to buy a house with my partner but one of us has previously owned a residential property. Can we claim the relief?
A. No. All of the buyers, when there are more than one, must be a first time buyer.
Q4. I previously bought a house jointly with my spouse/partner. The partnership has broken up so can I be treated as a first time buyer?
A. No. Where the individual has previously acquired an interest in a residential property as a joint tenant or a tenant in common the individual is not a first time buyer.
Q5. Is the relief available on transfers of interests in a home between partners?
A. Such a transfer normally requires a transfer from the existing owner to him/herself and the partner. Even if the partner is a First-time buyer the existing owner is not. So the relief is not available.
Q6. Can I get relief if I have previously owned an inherited property?
A. No. In this case a person will previously have acquired a major interest in a residential property.
Q7. Can I claim the relief if I’m buying on behalf of my parents?
A. No. Relief is not available unless the first time buyer(s) are buying, for themselves, a property that they intend to use as their only or main residence.
Q8. Is there an age limit on claiming the relief?
A. No. First time buyers can be of any age.
Q9. Is there a price limit on claiming the relief?
A. Yes, the sum for the whole of the purchase must not exceed £250,000.
Need more information?
Liz Pople of our Staple Hill office are specialists in acting for first time buyers under a number of schemes in existence to help First Time Buyers including the government backed First Buy Scheme for new homes and the Home Buy Direct Scheme. Wards Solicitors in Staple Hill are on the panel of solicitors for South West Homes and deal with these schemes daily.