To think new stamp duty is unfair on London AGAIN

[stupendoushorrendous]

Aibu to think that the new stamp duty rates will unfairly hit Londoners compared to an equivilent person (in wealth terms) elsewhere.

Example, Family bought their house for say £300k many years ago, value has gone up considerably. If they want to move to a different house of equivilent value they could be subject to over £100K in stamp duty. Their mortage could be doubled simply because they want to move.

Surely, this increase in tax could mean it is impoosible for some Londoners to move locally should they need to.

Your hypothetical working class pensioner widow will only have to stay put if she is determined to live in a property worth over a million pounds.

If she is happy to downsize to a small flat she will be better off, stamp-duty wise, in almost every area of London.

If she is desperate to live in Kensington and now finds it outside her budget, that only brings her into line with every other granny in the country.

To be honest OP I don't think you (and perhaps your neighbour who you seem to know a lot about their finances) understood the new stamp duty rules fully and rather than acknowledge this you are moving on to a discussion about why people are adding extensions to their houses.

That is perhaps why TheRealMaryMillington insulted you, not to worry though, while the change was something to get heads around, its quite simple when you do.

So a pensioner with a £1 million house in London can't afford to move to another £1 million elsewhere in London because of the small percentage increase in stamp duty.

Well most people 50 miles away with a similar house to the pensioner can't afford to move to that £1 million house, either, because they don't have the equity in their current house. There's 3 bedroomed houses 5 miles away in Durham that we can't afford to move to because we don't have the equity in our house, which has only gained about 20% in value in the past 11 years. Never mind stamp duty.

That's life.

I have more pity for people who can't get on any housing ladder, anywhere, and are stuck renting crap houses with crap terms. That London pensioner has a roof over her head for as long as she wants it.

I'm in the process of buying a house, and my stamp duty has just gone down by £1000! We are very happy!

I live in the SE and initially panicked. But actually I think Osborne has been clever, by the percentages only applying between the thresholds, so no one pays on the first £125000 etc.
So I think it won't put up stamp duty too much on our house. Which has the good point for everyone, that it won't cause a shock to the housing market (either stopping top end house purchase sale, or causing prices to fall sharply at the top).

YABU. My husband and I are in the process of buying a home. The stamp duty changes will save us over £1000. This may not seem a lot to somebody buying a millon pound house. To us, it will make a big difference. The house we're buying isn't that far over the initial stamp duty threshold, and it has always seemed unfair to me that you suddenly pay tax on the whole price, rather than just the bit that's over the threshold. I think any policy where all ordinary people (i.e those with houses under one million pounds) are better off has got to be a good thing. As others have said, of the very small percentage who will pay more, it's not actually that much extra in comparison to the amount they would have paid before.

So you've got a situation that slightly adversely affects a tiny proportion of people, who even so, still have huge advantages compared to the vast majority, to argue against a change that benefits most people.

YABU

I must admit, this is one of their better policies, despite the fact that I could have saved 4.5K this year if they'd done this in the March budget . It is a much fairer system and those who can afford a 1 million house are not poor. Maybe it will take the heat out of the London market, which is surely a good thing.

Yabu. I live in London and own my flat, if I want to move I would sell my home for a substantial profit, I could well afford a bit extra stamp duty. Not that it would ever affect most people, even in London there are not that many people living in 1 million + properties.

I suspect Lizzie is right and the OP hadn't noticed the change from a slab tax to a progressive one so was calculating using the old methods and the new rates, hence the 100K figure for 1M property.

With the tax finally being tiered and not a big jump on the whole value I think it helps Londoners, as the properties worth a bit more than the old thresholds will attract true value, especially the ones around the 500k mark of which there are more of in London/SE than elsewhere.

Now at least we get the same tax free portion as people elsewhere benefit from.

Remember you pay stamp duty when you buy a property, NOT when you sell it.

This actually isn't unfair on london. Everything under about 900k pays less stamp duty.

900k still gets you an ok house in zone 2.

The 'diddums' who will be affected by this in Lomdon (ie properties over £900k) include those hoping for a 16-ft wide 3-bed terrace in non-tube connected zone 2.

So it doesn't mean a lavish or central property.

This is a tax on Londoners. A lower threshold should have been applied outside London, so that all 3 bed terraced houses were included wherever located.

Yabu

This is great for most people and you don't seem to understand how sdlt works.

People living in London get so many extra benefits compared to those in the rest of the country that I don't think they can really complain when there is one thing that affects them negatively.

Public transport is cheap, reliable and really frequent in London compared to where I live. We were cut off from the rest of the country completely by rail last winter due to there being just 1 line in and out of the SW. Is anything going to be done to try and prevent that in the future? No, of course not but Londoners will be able to shave a small amount of time off their journeys with HS2.

"This is a tax on Londoners. A lower threshold should have been applied outside London, so that all 3 bed terraced houses were included wherever located"
No - the prices in London should come down - if you cant afford to move, then don't. Lots of people cannot live where they want to due to house prices, what do you suggest? a cap on the prices?

I would put money on those who think londoners are hard done by also subscribe to the 'holiday prices during school holidays should be cheaper' as well because its unfair on those with school age children...?

I know but still is a lot of money

I've tried. But sorry I simply can't dredge up any sympathy for those poor folk in their multi million pound houses. I think the council tax bands should go further up on a scale.

(i'd love to live in Brighton, but i cant afford it)

A) Londoners have benefitted hugely and surprisingly with recent price rises

prices rises only benefit you if you sell and move out of London. if you want to move within London it doesn't. Also, the volatility is a bit scary.

I own my house (with mortgage) in London and am unimpressed with the large increases.

I don't think prices in the school holidays should come down. But neither do I think that people buying the same holiday at the same time should be taxed differently because the cost varies regionally.

I'm not in London, btw. But I really do not think people realise how little house you get for £900k. It's not those seeking a lavish lifestyle who buy those houses. Those people are not multimillionaires. They are mid-career people with 2 children.

Yes, more and more people get priced out of London.

This measure will price even more people out, particularly families when an ordinary small house is taxed at the higher rate.

Now, you might decide that it's OK for the greater good to tax Londoners more for the same size property. But that doesn't make it fair.

I don't know why I'm posting this just to be flamed but...

We recently agreed a price of 1.95m after a 9 month search. My mum has been unwell and they live a few hours away so we wanted space for them to move and live with us too. We were expecting to exchange on the new house on Friday. So we have spent 19k on moving costs (application fees, mortgage adviser - 10k alone plus VAT, search fees, solicitors). However, the changes will cost us more than 50k - which we can't afford to pay as it was pretty tight before - so we've had to drop out.

I guess we have money to spend on renting for us and our parents - but the changes have really hurt our personal circumstances and whilst I actually agree with the principle behind the reforms, it feels very harsh to be caught in the middle of it. I don't think I could relish other peoples' misfortune as posters seem to do on here.

Would your vendors consider dropping their price accordingly walcatz?

But houses already in the process can choose which of the rules they want to apply, walcatz? So can't you just stick with the old ones?