Thousands of first-time buyers have revealed their ‘terrifying wait’ as they hope to have the keys to their new home before being clobbered by a stamp duty change that comes into effect on April 1.
The countdown to March 31 will be all the more stressful for those would-be homeowners waiting to complete a move around London, where many starter homes teeter on the brink of the tax increase.
In October last year, the Chancellor Rachel Reeves decided not to extend the freeze on stamp duty thresholds, meaning a return to the levels in place before the 2022 mini-budget.
House-buyers currently pay stamp duty if a property costs more than £250,000. But from April 1, buyers will have to pay a two per cent charge on all home purchases priced from £125,000 to £250,000.
The changes will hit hard for first-time buyers, who currently pay no stamp duty on home purchases up to £425,000 and five percent on pricier properties – but this threshold will shift to £300,000 after March 31.
The Kent town of Ashford – less than 40 minutes away from London by train – is proving particularly popular with first-time buyers at the moment, with small homes being snapped up in less than a month.
But the upcoming stamp duty change has left buyers across the area with their fingers crossed that they will be able complete their property purchase in the town before they are hit by the tax change, according to Ashford estate agent Gemma Skipper.
Gemma, who has worked as an estate agent in the area for more than 25 years, said her team had to warn buyers at the start of the year that they may have to pay thousands more than they expected due to the government change in policy.
Ashford estate agent Gemma Skipper who has worked as an estate agent in the area for more than 25 years, said her team had to warn buyers at the start of the year that they may have to pay thousands more than they expected due to the government change in policy
She told MailOnline how the changes should have been better explained by the government
Pictured: A man looking at listed properties on the window of estate agent Skippers. Ashford has seen a rise in people looking to buy in the area
She said: ‘I do think it could be explained better by the government. It’s a real learning curve for first time buyers.
‘Anything from January has been touch-and-go – there’s been a lot of explaining to people to make sure people know what they might face.
‘It’s more impactful for young families. The family market has been quite impacted.
‘You buy a house at £650,000, which is mid level these days, and you may have to lose tens of thousands of pounds, so you really do seriously think about it.
‘Stamp Duty is something people really have to seriously consider when they are buying a house.
‘It just adds and adds and adds.’
Lee Blackman, a partner at Gould Harrison Estate Agents, has been busy calling people in the process of buying so they know to budget for the stamp duty hit.
He said: ‘There’s quite a few instances where we have said, ‘you’re not going to get there in time’.’
Now the government needed to leave the property market alone, the estate agent said.
Lee Blackman, a partner at Gould Harrison Estate Agents, said there have been several instances where they have had to tell people they won’t be making the stamp duty freeze in time
He says he has had to call clients to warn them to budget for the stamp duty hit
A mother peering into the window at Skippers, viewing houses through the advertisements
He added: ‘Understandably the government got involved with incentives and left them for far too long. The market was overheated.
‘So people who bought a property for £325,000 in 2018, that property should have increased to be worth around £395,000 – but it’s worth what people paid for it.’
Mum-of-one Kirsty Fisher, 35, who has lived in Ashford for more than 20 years, said the stamp duty change was a ‘typical’ setback for people of her age looking to save up for a property.
Kirsty, who lives with her parents in an effort to save for a deposit on a house, said: ‘Every time we get close to being in a position of buying, something makes it harder.
‘Trying to find an affordable home around here is so tricky.
‘It’s got to a point where we’re thinking do we stay living with family for a while and save for longer and get a bigger property.’
One dad, who faces a nervous wait, said: ‘It’s been stressing me out a lot. I’ve not slept much.
‘It’s a terrifying wait. Rachel Reeves is just inflicting misery on people.’
Mum-of-three Deron Smith, who works as an administrator for the NHS, said her young family had lived with her parents for years in order to buy their property – with four of them in one room
Now she says they would not be looking to move any time soon in part due to the stamp duty change
The average terraced home in Ashford costs £278,407 and these ideal starter homes go from being listed to SSSTC in an average of 29 days, according to Purple Bricks data
Mum-of-three Deron Smith, who works as an administrator for the NHS, said her young family had lived with her parents for years in order to buy their property – and now they would not be looking to move any time soon in part due to the stamp duty change.
The 34-year-old said: ‘We bought a house 18 months ago. If we were to move in the future, stamp duty changes would definitely make us think twice.
‘As it is, we wouldn’t be looking for a while.
‘We had to move back into my parents’ place to save up to buy our property. We were there two and a half years – four of us in one bedroom.’
But Deron said she had some sympathy with the government’s tax hike – if it meant better services and support for families.
She said: ‘They are doing what they can – but some things could be much, much better, like child care support.’
The average terraced home costs £278,407 and these ideal starter homes go from being listed to SSSTC in an average of 29 days, according to Purple Bricks data.
A contemporary three-bed townhouse on the market is just a short walk from Ashford International Station and is on the market for £300,000.
Estate agent Gemma said Ashford was experiencing an on-going property price ‘bubble’ due to town’s railway connections.
She said: ‘It’s our strength, we’re in a great location.’
But high-speed train to Paris and Amsterdam have not stopped at Ashford International since the Covid-19 pandemic – and in January, Eurostar service announced that they will remain closed for the rest of this year as a review is carried out.
