December is usually a quieter month estate agents, and understandably so, as the nation gets ready for Christmas with family & friends, or running away to warmer climes for an extended festive break. There’s generally not much activity from anyone looking to buy, sell or rent, and there’s generally not much news either; so few were more surprised than us when we achieved a number of notable sales and lettings, and when the Chancellor dropped his Stamp Duty surprise of the season.
For anyone still not sure about the new rates for residential property, from midnight on December 4th you’ll pay:
nothing on the first £125,000 of the property price
2% on the next £125,000
5% on the next £675,000
10% on the next £575,000
12% on the rest (above £1.5 million)
If you buy a property for £275,000, you’ll pay £3,750 Stamp Duty. This is made up of:
nothing on the first £125,000
£2,500 on the next £125,000
£1,250 on the remaining £25,000
The changes took effect just hours after the Chancellor’s announcement.
In short, anyone buying a property up to around £960,000 will be better of which, almost anywhere else in the country that would mean pretty much everyone, but in London it’s obviously a very different story and clearly most of the extra revenue is going to come from buyers in the capital.
Is it fair? Well, probably yes. There’s always the extreme newsworthy case of someone losing out, but anyone paying extra stamp duty will likely recuperate that – and then some – with the increase in the value of their property over their term of ownership. And for the UK property market to function properly, it’s imperative that people further down the chain are given the opportunity not just to get on the property ladder, but also to move up it. The UK Stamp Duty formula has been badly wrong for too long, hitting people hard who buy at just above each threshold, with increased duty charged on the total purchase price, rather than proportionately. That has now been addressed and we think that’s a good thing.
Back to us, and among some of the sales we agreed this month are:
Reed Place, an outstanding loft converted from a Victorian school in Clapham – asking price £695,000; Godman Road, a three bedroom ‘upside-down’ contemporary house in Peckham – asking price £750,000, and Colina House in Harringay, a rugged 1700sq ft factory conversion – asking price £800,000.
We torn between two when it comes to our favourite letting of December. At The Lycee in Kennington, one of London’s finest school conversions, we agreed a beautiful 1300sq ft duplex – asking price £750 per week, and in Mermaid Row at London Bridge, we found tenants for a quite astonishing detached contemporary house – asking price £650 per week.
In all, this was an interesting and unusual December, full of unexpected news and results. We’re looking forward to seeing how the Stamp Duty changes affect the market next year, and you can be sure we’ll let you know what happens.