Rate of Stamp duty is raised – what is the effect?

Despite the fact that the introduction of additional Stamp duty at the rate of 3% for buyers of second homes in the UK met strong resistance from the community of Landlords, it turned out that this measure has a lot of supporters. The next pool held jointly companies YouGov and insurance company BLP Insurance showed that after the reform of Stamp duty in 2014 concern about paying it decreased from dramatic levels. People do not consider it a serious problem and safely react to the payment of Stamp duty.

And 47% of respondents said they approve of the enforced measures taken by the government from 01 April 2016 to increase the 3% Stamp duty.

Supporters of this increase believe that it was necessary to equalize the ability of investors and young families buying their first home, which was practically cut off from the affordable housing market due to excessive activity of landlords “buy to let” . People believe that homes in England are meant to live, not to speculate them, but if someone has the extra money for the second, third, fourth house, he should pay more tax.

Opponents of the new rules believe that the increase in load on the investors a boomerang effect on the tenants in the form of higher rents and overall government policy is aimed at restricting the rights of business. Some wanted to become investors and have been saving up for this dream all my life, but Now, the new rules pushed the dream indefinitely.

The increase in Stamp duty from 1 April 2016, has a dual effect on the market. On the one hand, first-time buyers buying a house are now in a privileged position, as they do not have to pay additional tax. On the other hand, the inevitable increase in rents will increase the time that a new buyer has been able to accumulate a Deposit for the down payment. Available real estate market is always fueled institucionalne investors. Will the market of real estate of great Britain to maintain the balance and to obtain the expected effect, we will see in the coming months.

® Helen Entree. 20.04.2016 G.

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