30 Dec

Stamp duty changes could hit new landlords

Stamp duty changes could hit new landlords

The introduction of an extra three per cent stamp duty tax on buy-to-let and second homebuyers could prevent many new investors in the landlord sector, claims a leading estate agency.

London-based Chestertons has raised concerns that the new tax could prevent many people investing in property to help fund their retirement.

Figures produced by Chestertons suggest that those buying property at the lower end of the market will face a larger percentage tax burden because of the tax changes.

"The Chancellor claimed that this change to stamp duty would prevent wealthy investors and overseas buyers from pricing first time buyers out of the market, but as usual the devil's in the detail,” said Nick Barnes, head of research at Chestertons.

"What we can now see is that this change is likely to completely deter many first time landlords from getting into the private rental market in the first place, including pensioners looking to wisely reinvest their precious pension pot,” he added.

Under the new changes, a buy-to-let property purchased for £150,000 will attract a £5,000 stamp duty tax liability, compared to £500 under the previous arrangement - a tenfold increase.

However, a property for £1 million will have to pay £73,750 in duty, compared to the existing £43,750 - less than twice the amount.ADNFCR-1222-ID-801809060-ADNFCR

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