The festive season is upon us and the last thing you may be thinking of is selling your home. There have been many changes within the property industry this year including the mortgage approval system and more recently the stamp duty reform. With a General Election fast approaching, why should you consider selling in early 2015?
- Stamp Duty
As you may have read, George Osborne’s reform on the Stamp Duty Land Tax (SDLT) at the beginning of the month saw changes to the system overnight. This meant that the previous “slab” system has been replaced by the preferred sliding system.
|Purchase price of property||Rate of SDLT (percentage of portion of purchase price)|
|£0 – £125,000||0%|
|£125,001 – £250,000||2%|
|£250,001 – £925,000||5%|
|£925,001 – £1.5 million||10%|
|Over £1.5 million||12%|
How does this work in practice?
If you were purchasing an apartment for £300,000:
- You would pay no tax on the first £125,000
- 2% on the next £125,000 (£2500)
- 5% on the last £50,000 (£2500)
That’s a total of £5000 compared with £9000 under the previous system.
Many are stating that this change to the upper brackets is a political move, and if the there was to be a change in government that the revered Mansion Tax may now not be imposed. But as history dictates, you cannot predict what each political party may change or introduce once they are in power. Homes up to £937,500 will now certainly benefit from the change in Stamp Duty payable.
- Interest Rates
We have been blessed for some years now with low interest rates. It has been hinted for some time that these are expected to rise during 2015. Although we believe that for many homeowners it will not have a huge impact. We do predict however, that many will want to move in the early part of 2015 to tap into a lower interest rate mortgage before the rise.
Although the nicknamed mortgage “stress test” has slowed the market in some sectors, the number of mortgage products available is on the rise. With preferred rates and deals being pushed by major lenders it has certainly been an attractive time for buyers over the later few weeks of this year. We envisage the growth of potential buyers to continue to rise in the early part of 2015. What a better time to sell your home than when buyers are a plenty and mortgages more attractive.
- House Prices
The Centre for Economics and Business Research predict that house prices will dip by 0.8% by the end of 2015. They have confirmed that this is only due to a ‘levelling off’ from the rises during 2014. We predict that the early part of the year will remain strong with prices starting to slow after April and continuing for the rest of the year.
- Time of the Year
Although Easter to summer tends to see the most movement in the property market we believe that there will be a strong start to 2015. Homeowners have already started to approach us with the intent of listing their property at the beginning of next year. Their reasons? They too anticipate a rush of buyers seeking to move before the election. Moving before Easter will allow you to enjoy the summer months in the comfort of your new home.
Whatever 2015 may bring we look forward to helping you move.
To find out why you should use Ellis and Co Golders Green, read next: 5 Reasons why you shouldn’t list your home with Ellis and Co Golders Green