Ridiculous stamp duty costs

[Ffsman]

No stealth boasting, one upmanship etc. and I know it’s first world problems.

We have a relatively expensive house, but only because the area is expensive, it looks very average and truly unremarkable. I don’t actually earn that much, the house is certainly more than 5x our join salaries.

We’d like to move, but the stamp duty amounts are horrendous, above around 900k it really goes up and above 1.5m and you’re paying 12%.

We’d like to move slightly out, around 15-30mins walk from the city centre which will give us a little more space, price will be around the same as ours give or take a couple of hundred thousand.

I’m struggling to come to terms with just how much we’ll lose in stamp duty.

The people in my position, did you just do it? Stick where you are? Etc

Also I can’t afford to keep moving, one bad neighbour who makes our lives hell and we are screwed.

We have no realistic option to extend our current house. Its city centre and the plot is good but small.

Any thoughts?

Exactly. 'Older people' probably didn't pay any stamp duty at all.

Whenever taxes are changed, there are always winners and losers. Doing it gradually gives people a chance to adjust. The recent tax changes on employers NI/ IHT are no exceptions and obviously people are complaining about those. Of course some people will be unhappy but it would tend to encourage downsizing which would be a good thing over time, as long as effort is made to build suitable homes at the 2/3 bedroom level.

@shockeditellyou the current council tax banding does not represent relative pricing at all. Many Londoners, it multi million £ properties now pay less than those in 500k properties in other areas. That could be changed to make it fairer in conjunction with what @XVGN suggests.

That’s my point. I bought in an expensive area seven years ago and paid a lot of stamp duty. Now want to move again and am facing the same situation. It’s not fair.

Even then, house prices were such that the £1.5M semi today would have been charged very little SDLT in 2005, say. Rampant SDLT has only been an issue in the last 10 years or so.

As an older person myself, I don't want to con the kids that life was as hard for us.

I’m sure no one on this thread wants to con young people & I doubt they identify as kids.

Where we are you are not necessarily rich it's just the house values have gone up ridiculously

You needed to live somewhere to have a family and you had to buy a house.

It would be fairer if they raised the thresholds especially in South East

Same with inheritance tax

What are they actually going to do with all this extra revenue is the question

It's all very well saying that but the fact is that younger people have been and still are being discriminated against in the UK and other advanced economies. And then, when someone suggests a way that might, in time and in a gradual way, slightly alter the balance, people always pop up and suggest that older people deserve special tax breaks to induce them to downsize and that it would be really unfair to make them pay proportional to the value of their home. They clearly do support the current system which cons young people after all.

Here's my story from the early nineties. We bought a new build 2 bed detached bungalow, with detached garage, for £40K on a household income of £30k. We paid no stamp duty on it. We had two lovely kids (children). The BoE base rate went up to 15% in 1992 (for one day only!) and it was just a small worry.

Overall our lives were massively easier than young families today.

@rainingsnoring totally agree- i am baffled at the amount of older people who have no issue seeing their kids struggle to even buy anything basic and are often extremely well off themselves. I can't sadly gift my 26 year old son a house deposit- as he wants to remain in London - and we rent ourselves- albeit a very nice place- but I did pay his deposit on his rental flat, furnish it basically and take him and GF away with us once a year .

Unfortunately it affects the young as well with house buying with the expensive stamp duty. It will now start at 125k rather than 250k which is so ridiculously low

Well same seeing as we live in the South East.

But the fact remains that if you can afford to buy a high value asset it is reasonable to pay a higher stamp duty tax on it, in my opinion.

a tax that disincentivises moving, and incentivises making smaller houses ever bigger is doing some weird stuff…

Much better to have an annual tax on property value, that nets the same amount, but over a longer period.

I agree the threshold should be higher than 125k. You can’t even get a 1 bed flat for that in more expensive areas.

Not in the same price bracket but the 30k I paid in stamp duty 12 years still hurts it’s the biggest lump of tax I’ve ever paid to the government in one go (employed so PAYE) it sort of feels like you don’t get much in exchange. Council tax goes for bins, schools social care, NI to fund pensions, tax for NHS, whatever they call road tax nowadays for the roads. No idea where stamp duty goes or what it funds.

Thanks. I'm baffled by it too. Although, if people just openly admitted that they are selfish and don't care about others in society, at least they would be being honest!

I think it is fair on a societal level because governments need to raise taxes to pay for good public services and stamp duty is one of the ways they can do this.

But on a personal level I agree it feels annoying because the same thing happened to us a few years ago.

Stamp duty is basically just robbery. It’s a tax to pay for a war that’s been over for hundreds of years and now just hinders people trying to put a roof over their heads. It shouldn’t be payable on your main residence but I guess no government will ever get rid of it.

It's why home owners don't complain about prices rises, their is still 100k between our house and our next house regardless of the cost of each one

That isn't how percentages work.

This isn't fair. One reason we want to downsize is to free up money so that we can help out kids with deposits etc.

@dollybird and that's totally different- good of you to do that. I wish I could!!

Well looks like exchange for my FIL on Wednesday - fingers crossed!!a smallish compromise was reached as they simply couldn't find the extra -

By the time he went through process again, probably paid more for something similar ( as I got the ideal place at 10% below asking - and it was a good deal at the asking) and paid more stamp duty if he held off till spring- it wasn't worth not compromising!!

Fingers crossed for Wednesday - but all looks good

I think it is missunderstanding of what I said. I said I don’t feel sorry for someone having to pay stamp duty on 1.5-2m house., nor do I feel sorry for somebody selling expensive house and having to pay stamp duty on smaller one when moving. Overall some level of wealth taxation would be healthy in my opinion. I.e. similar what you said paying higher council tax when living in bigger property.

Argument of others is them saying they didn’t choose properties values to go up for so much, but they did. And so their wealth status changed too, if they choose to stay in low paid jobs while living in million pound houses and can’t afford to upkeep it or pay taxes on such asset, again I can’t feel sympathy for it.

Ok thanks for explaining @Wanderergirl

Wrong thread, @Crikeyalmighty ?

@Twiglets1 ha, ha yes !!