Stamp duty reforms 2022. What’s changed?

Chewton Rose has welcomed the Government's ‘mini-budget’, which will bring significant benefits to the housing market.

On the 23rd September 2022, Chancellor Kwasi Kwarteng announced cuts to stamp duty in the government’s mini-budget, by increasing the amount at which buyers in England and Northern Ireland will begin paying duty from £125,000 to £250,000. For first-time buyers, this threshold is now £425,000 and discounted stamp duty will apply up to £625,000.

What is stamp duty?

When you purchase a property or land, you are required to pay a form of tax called ‘Stamp Duty Land Tax’ (SDLT). The amount you pay can depend on the price of the property, the location of the property, whether you’re a first-time buyer or if you’re a UK resident.

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Stamp duty for first time buyers

People buying their first property can often be put off by having to pay stamp duty on top of their deposit, as well other property purchase related fees like conveyancers, property searches, etc.

To help first-time buyers, the government has raised the amount they can spend on a property without having to pay stamp duty. First time buyers will now not have to pay stamp duty if their first home costs less than £425,000, which is an increase of £125,000 on the previous level.

However, if a first-time buyer does purchase a property that costs more that £425,000, they will be entitled to relief. This means first time buyers purchasing property above the new threshold will pay 5% stamp duty land tax on properties up to £625,000, which is an increase of £125,000 from the previous limit.

What are the new stamp duty rates for first time buyers?

If you’re buying your first property in England or Northern Ireland from 23rd September 2022, you’ll have to pay the following rates for stamp duty:

How does the 2022 stamp duty reform help?

The new measures taken by the government will reduce the amount of stamp duty for all property purchases by up to £2,500, with first time buyers also now able to access up to £11,250 in relief.

This reformed policy will be a welcome tax-cut for the majority of people purchasing a new (or first) property as they will be able to keep more of their money for additional house renovations or other expenses. This new tax cut will also help increase household purchases and in turn boost confidence in economic growth.

What are the new stamp duty rates for non-first time buyers?

If you’re not a first time buyer in England or Northern Ireland, from 23rd September 2022 you’ll have to pay the following rates of stamp duty:

Our Senior Team’s View

Paul Smith, CEO.

Commenting on the mini-budget, CEO Paul Smith said: “I’m delighted that Liz Truss is following in the footsteps of Margaret Thatcher and understands the economy is fuelled by a healthy property market.

“Thatcher once said that she wanted a capital-earning democracy, which housing was the start of, and if you’re a man or woman of property, you’ve got something. 

“I absolutely agree, and clearly the new Prime Minister does, too.

“This mini-budget from Chancellor Kwasi Kwarteng is revolutionary on stamp duty - cutting it permanently, and not just introducing a holiday with a spurious deadline, is a massive boost for the market.

“This will give a massive confidence boost for those now wishing to sell.

“I am also pleased to see that our hard-working colleagues will benefit from a cut in the basic rate of income tax to help them with the cost-of-living crisis – Chewton Rose is nothing without our brilliant people.”

Group Managing Director, Antony Lark welcomed the stamp duty changes.

“This is an extremely positive move and will assist so many people in getting on the housing ladder,” he said.

“The fact that this is a permanent change will help ensure we avoid the cliff edge type environment we have recently lived through.

“Owning your own home is such an important aspiration for so many and it’s so positive to see the government look to support this to help grow the economy.”

Tim Wardley, Managing Director of Land and New Homes.

Managing Director of Land and New Homes, Tim Wardley added that the 38 investment zones mooted in the so-called ‘Kwasi Budget’ will generate significant growth, thanks to business tax cuts and a fast track on planning applications.

He said: “This is great news for our industry right across a board at a time the market has slowed.

“The planning system is completely clogged up and anything which can get more houses built is a winner for everyone - buyers, people selling land and developers alike.

“The stamp duty cut is also a game changer which begins now and carries on indefinitely, meaning no waiting for start dates or need to hit deadlines.

“It’s now time for us to grab this opportunity and make the most of it.”

Contact your local Chewton Rose branch

If the latest stamp duty cuts have prompted you to take the next steps in your property journey, get in touch with your local Chewton Rose branch today and we’ll get the ball rolling.

We can help you get on the property ladder, find your next home, or if you have a property to sell too, we can offer a free no-obligation valuation.