Will Stamp Duty changes affect the Altrincham housing market?
Will Stamp Duty changes affect the Altrincham housing market?
There’s a lot for homebuyers to consider at present, but we want to know how the new Stamp Duty changes will affect the Altrincham housing market. Property prices in Altrincham have never been higher; mortgage rates are increasing and housing stock in the area is low versus demand.
Will the new Stamp Duty changes make a difference?
Stamp Duty cut offers instant savings
Here’s an overview of the new Stamp Duty Land Tax reduction which came into force on 23rd September 2022.
- Stamp Duty has been abolished on the first £250,000 of any property purchase, (up from £125,000), making an immediate saving of up to £2,500 for home buyers. Close to half (47%) of all sales in England over the past year were under £250,000.
- First-time buyers could save up to £6,250, because they will now be exempt from stamp duty on the first £425,000. The purchase price at which they can take advantage of this relief has been raised too, from £500,000 to £625,000.
- Second home owners and overseas purchasers will still be required to pay the 3% Higher Rate Additional Dwelling Tax and 2% non-resident surcharge respectively.
- The Chancellor’s announcement only applies to England. From October 10th in Wales, no Land Transaction Tax will be payable on homes priced up to £225,000 (current threshold £180,000), a saving of £1,575 on a property priced £225,000. Those paying over £345,000 are set to pay more.
- For now, rates in Scotland remain unchanged. The threshold in Scotland is £145,000.
Source: Dataloft, HMRC, Land Registry, Welsh Revenue Authority, Revenue Scotland.
Will buyers in Altrincham benefit from the Stamp Duty reduction?
Yes, some people looking to buy a property in Altrincham will see savings. A saving up to £2,500 in most cases. But in terms of paying no Stamp Duty Land Tax at all, as a stepper-upper, relevant properties will be few and far between. Unless you are looking to buy a flat or an apartment, average house prices in Altrincham are far higher than the £250,000 threshold for Stamp Duty.
First-time buyers could buy (based on present average sales figures) a terraced or semi-detached property in Altrincham and pay zero Stamp Duty. However, with averages for semi-detached homes already around the £420,000 level – are these properties altogether too expensive for first-time buyers? For anyone moving up the ladder, the stamp duty at the current rate on a £420,000 property would be £8,500.
But if you consider the deposit and mortgage repayments based on current interest rates for first-time buyers, is the stamp duty saving too little too late? Especially here in Altrincham, first-time buyers might still feel priced out of the market.
Altrincham housing market – average property sale prices
We take a closer look at the average sale price of properties in Altrincham over the course of the year, from August 2021 to July 2022. This helps outline how far up the scale property prices are in this region.
Starting with flats and apartments, these did peak and tip over the £250,000 mark back in September 2021. This will be largely down to the Stamp Duty Land Tax reductions announced by the last government, pushing up prices during a very busy period. More recently, and in July 2022, the average price of apartments and flats in Altrincham was below the current Stamp Duty threshold, at £237,755.
While terraced properties are usually the most affordable, here in Altrincham they’ve always been lucrative, and expensive. As far back as August 2021 the average price of a terraced home in Altrincham was £337,184. Since March 2022, the average sale price of terraced properties has increased, to £365,005 in July 2022.
The average sale price of semi-detached properties in Altrincham tipped the £400,000 mark in December 2021. They have been increasing ever since and in July 2022, the average price for a semi-detached was £420,104.
It is with detached properties where there has been a little more fluctuation (although marginal) in the average sale prices. They have hovered around the £640,000 average sales price throughout the year, hitting a high of £662,169 in May 2022. The July 2002 average sales price for detached properties in Altrincham was £648,024.
You can find out more about how affordable homes are in Altrincham here.
People making moves in an unpredictable market
We are seeing more properties come on the market based on how unpredictable things are present. One example we know of is rental homes being put up for sale. It is a real shame as there are a huge shortage of rental properties here in Altrincham to meet the demand. But landlords are under extreme pressure, with new legislation and increased mortgage rates alone. As the cold weather approaches, many landlords are coming under intense pressure from tenants around energy bill costs. Some landlords have no choice but to sell up.
On the flip side, Altrincham is fortunate in that there is always interest in this region when it comes to property buyers.
Being on the doorstep of some of the region’s very best schools, is a massive plus. Buyers love the close proximity to the thriving social setting Altrincham offers, as well as plenty of green space nearby. It’s an ideal location for those who do have to commute to work. The Metrolink is available and there is easy access to the motorways. So, in some respects, stamp duty reductions or none, Altrincham will remain a popular place to buy. But what do we think we will need to watch in the near future? The impact the increasing interest rates will have on buyers, sellers, and homeowners in the region.
Are you considering selling your home as the rising cost of living bites? Or perhaps you want to take advantage of the new Stamp Duty changes to sell your current Altrincham home and buy something bigger? Whatever your circumstances, you can discuss your next steps with us. We are experts in the Altrincham property market and will be happy to help and advise you. Contact us today.
Please note: all data and statistics quoted in this article come via Dataloft.