To ask seller to reduce asking price due to stamp duty increase

31 March 2025. Should be enough time for you to complete.

Did you buy your parents council house using their discount OP? Is this the reason you are locked into the co- ownership of their house?

Asking for a discount as you can't afford your second home?

I've heard it all now

This is very much a your problem

I would not reduce the price as a seller.

The tax is yours to pay...not something the seller should be subsidising for you.

If there is now no mortgage on the property your parents live in why can't u transfer the property into your parent's names now and get them to sign a loan saying they owe you the 75K - this loan can be registered with the land registry and so you would have the protection of a mortgage secured against a property owned by your parents.

After you have completed on your house you can get your parents to take out equity release to pay you the 75K. That transaction would take a while to arrange so I can see why it can't be down before you buy your property.

I can see there may be IHT or care home fee issues if that was partially why the property was put in your joint names but the quick solution could be done within days - your parents will need their own solicitor for the transfer deed and to approve the charge. That way your seller doesn't have to pay for your family circumstances and you can sort out equity release at your leisure if you want the 75k back.

I would get your self off the deeds asap. You might save yourself inheritance tax (I doubt it as you can get 1 million tax free if you are inheriting your parents’ home) but you will be giving yourself a massive capital gains tax bill in the future if you try to sell your parents’ home.

On this basis - I would ask the EA to explore whether the vendor would entertain reducing/splitting the cost when the alternative is a collapse of the chain?

Others in the chain may be similarly impacted so there may be a ripple effect anyway. If they decline you’ll know where you stand.

How much are your parents giving you to help buy your new house?

If you want to retain your interest in your parents house, get a cash gift from them, and have your sellers bear the brunt of your tax liability, it’s hard to see how you don’t just want it all your own way.

I might agree if I was desperate not to collapse the chain, but I’d be making zero effort to leave you a clean house and tidy garden, and there’d be zero extras. I’d take the lightbulbs!

Would you still understand as a seller if you found out your buyer was mortgage free on their first property? That's an absolute piss take.

It's just the reverse of what happened when Sunak suddenly cut SDLT in 2020-2021. Seller increased their prices in excess of the stamp duty cut, buyers were forced to pay more. Increasing SDLT will tend to have the reverse effect. It doesn't matter what the morals of either the cut or the rise are or whether it was fair on buyers back then or sellers now, it's just a market and increased fees tends to lower prices and visa versa. People can be annoyed and that is a reasonable reaction but it doesn't change the situation.

YABU and would be a CF. The stamp duty does not go to the seller, so why should they get less money because of the recent rise?

What are the figures?

3% stamp duty plus another 2% is £10K making your new home at about 500,000K?

so total stamp duty is £25,000 now?

Yet you own £75K in your parents home?

If they can’t buy you out they should give you a nominal sum and then leave the £75,00 to you in their will - ring fencing it

Or you should suck it up and find the money!

I wasn’t saying OP should have budgeted for it. I’m saying my buyer asking to reduce the sale price because of the budget is their issue, not mine. I don’t have a second house, I’m unlikely to have a second house and I don’t see why I should take a financial hit because someone is purchasing my house as their second house. It doesn’t matter the situation as to why this OP’s second home the fact remains that it is.

Did you miss the bit where I said I would probably allow some wriggle room if genuinely close to exchange? But all trust is going to be gone. Again it doesn’t matter that the budget came out today because I still don’t have a second house and OP does and I’m taking a financial hit for OP to have two homes. I’m going to feel like the fact that it is near completion has me over a barrel of accept this or lose my onward purchase. OP is asking how we, as sellers, would react and this is how I would react as a seller. The trust would be gone and OP would get absolutely no good will from me. All the good will have been used in OP not paying the full tax. You can think it’s harsh but that’s the reality of what a lot people, likely including her sellers, will think. If you think it’s harsh, you are of course welcome to make up OP’s shortfall out of your own pocket.

If the parents sell and downsize, @randomchap, the chain will clearly fall apart anyway and the seller will need to re-market.

The OP isn’t clear, making it seem as if they were just named on the deeds as a formality but then saying they also occupied the property as their primary residence?

Well you can ask, @Ouch12 but they may say no and they will obviously be annoyed. The seller will need to weigh up taking a reduction (what's the % reduction by the way) with the risk of marketing the property again and possibly having to accept a lower offer. Stamp duty goes up further in April 25 so a new buyer would need to take that additional cost into consideration when making an offer now.
I think there will be lots of chains that end up breaking or being re-negotiated because of this change. Online brokers were apparently receiving emails about re-negotiations straight after the budget.

So you need an extra £10000 due to a rise from 3% to 5% tax? This would mean the property is worth £500000

Why don't you ask your mortgage provider for more money, maybe extend to a longer term to make it affordable.

Or your parents could sell up, and downsize.

I think if you have already exchanged contracts your purchase will be exempt based on the draft legislation:
assets.publishing.service.gov.uk/media/67209bf934853837d7fc40f8/SDLT_draft_autumn_2024.pdf

I think you need to wait for clarity. This law might not affect you as you had put an offer on this property when a different law was in place

Contact your solicitor before you start going crazy

Also I truly hope you did take that mortgage out over 10 years ago at the very least

If the mortgage is paid off, just remove yourself from the deeds and you won't be buying a second home any more. Job done.

No I wouldn't. What were your expectations regarding a future property purchase when you agreed to that arrangement? Tax on second homes was always a risk. Also what if you couldn't get a mortgage because you were already on theirs etc?

No way would I be prepared to pay your tax increase for you. I’m being hammered myself as it is.

This happened in Ireland a few weeks earlier due to our budget but only at the higher end of the property market.

I know of a few cases where buyer and seller agreed to split the difference to ensure the sale was finalised.

It's absolutely worth asking but no more than splitting the difference.

If your vendor won't accept a reduction in your offer, you will probably have to return to searching the market for a cheaper house that you can afford.

Your circumstances weren't entirely unforeseen so best policy would have been to looked for a property that wasn't close to the top of your budget. That would have given you the wiggle room that you now think your seller should provide you with.

If you genuinely cannot proceed because you really don't have the extra money, then be honest and open with them and see if there is something they can do to keep chain going. That's perfectly fine. As a seller I would understand. We had this from our buyers but it does irks me when they cried poverty before exchange asking for a reduction, only to drive pass my old house once a month and see loads of expensive upgrades done to it! Where did that money magically come from?