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Original poster

Stamp duty

31 replies

ProssecoParent · 30/12/2024 10:58

We're wanting to move into a bigger house. We have the funds to purchase another house without needing to sell our current home first however we've just found out that if we don't sell our first home and purchase a second home than we would have to pay £10,000 in stamp duties?! We were planning to put the house on the market anyway but we were hoping to purchase another house straight away. Is there anyway around this? That's a lot of money that I don't really want to spend if I don't have to but also where are we supposed to live if our house sells? I don't understand how everyone does this does everyone really just pay £10,000 when moving?!

OP posts:
CellophaneFlower · 30/12/2024 11:04

ProssecoParent · 30/12/2024 10:58

We're wanting to move into a bigger house. We have the funds to purchase another house without needing to sell our current home first however we've just found out that if we don't sell our first home and purchase a second home than we would have to pay £10,000 in stamp duties?! We were planning to put the house on the market anyway but we were hoping to purchase another house straight away. Is there anyway around this? That's a lot of money that I don't really want to spend if I don't have to but also where are we supposed to live if our house sells? I don't understand how everyone does this does everyone really just pay £10,000 when moving?!

People generally sell the house they currently live in and buy their new property at the same time, so move from 1 straight to the other.

I believe if you do as you're proposing, you will have to pay the additional stamp duty but can claim it back when you sell your original property as long as it's within 3 years.

CellophaneFlower · 30/12/2024 11:04

Apologies for quoting your OP... I hadn't realised I had 🙈

RedDeadReflection · 30/12/2024 11:05

Exactly as pp said. Most don't own two homes at the same time.

JoyousPinkPeer · 30/12/2024 11:06

People sell/buy on the same date to avoid this abd because they don't have money to pay for 2 houses

OhWifey · 30/12/2024 11:08

Depending on the value of the house you're buying you have to pay a proportion as a tax (stamp duty). If you already own a home you have to pay a higher level of stamp duty.
The only way you won't is by not buying a house above the lower stamp duty threshold

Original poster
ProssecoParent · 30/12/2024 11:12

JoyousPinkPeer · 30/12/2024 11:06

People sell/buy on the same date to avoid this abd because they don't have money to pay for 2 houses

But how do you buy and sell on the same date? Sorry if I sound stupid my advisor won't answer my calls so hes no help. If my current house sells doesn't that mean technically it's no longer my house and the new owner will move in? And than doesn't it take a while to be able to move into your new house as in what if the house you purchase still has a family living in it waiting to move? It's all so confusing

OP posts:
Nourishinghandcream · 30/12/2024 11:13

As a PP said, I believe you can claim back the additional SD as long as you sell your house within a specified timeframe but you will need to fund the SD in the short term.

clary · 30/12/2024 11:16

Op you complete (ie actually sell) your house on the same day as you complete in the house you are buying. If lots of ppl do it at once it’s called a chain (which is why some ppl move to rented, or buy new build as this stops the chain). All the money is then transferred on the same day. Obvs a shorter chain is good (eg we sold to a FTB and our vendors moved to rented).

Have you never moved house before? Surprised a homeowner does not know this.

Nourishinghandcream · 30/12/2024 11:16

ProssecoParent · 30/12/2024 11:12

But how do you buy and sell on the same date? Sorry if I sound stupid my advisor won't answer my calls so hes no help. If my current house sells doesn't that mean technically it's no longer my house and the new owner will move in? And than doesn't it take a while to be able to move into your new house as in what if the house you purchase still has a family living in it waiting to move? It's all so confusing

Show quote history

You are in a chain and exchange & complete together which is why the whole (English) process is so horrible as it can fall apart right up to exchange.

When we moved three years ago we sold and moved into another property we already owned until our new house was ready.
Certainly made the process easier (still stressful though).

3rdCoffeeThisMorning · 30/12/2024 11:17

It's really not that confusing. You just tripped ovwr and ended up lost in a forest of thoughts.
Example :
You selling house to buy another. Only 3 in chain.
You advertise yours in January and are looking for one to buy. Offer from your buyer accepted, your offer on new house accepted in February. All searches etc run at the same time for both properties. Everything is ready on 5th March. You all agree to exchange on 10th with completion on 20th March.
On 20th morning, your buyer pays you, you are out of house and they move in, your seller gets paid after lunch and they are out of the house and you move in.
Simple 😁
Stressful as fuck

(disgard u realise timescale in example😂)

CellophaneFlower · 30/12/2024 11:18

ProssecoParent · 30/12/2024 11:12

But how do you buy and sell on the same date? Sorry if I sound stupid my advisor won't answer my calls so hes no help. If my current house sells doesn't that mean technically it's no longer my house and the new owner will move in? And than doesn't it take a while to be able to move into your new house as in what if the house you purchase still has a family living in it waiting to move? It's all so confusing

Show quote history

It's called a chain. However long your chain is, you all sell and buy and move on the same date. It sounds impossible and often it is and many chains break and sales/purchases fall through.

Obviously the shorter your chain the more likely things are to complete and for everyone to move!

DangerMouseAndPenfoldx · 30/12/2024 11:22

If you want to avoid the stress of doing it all in the same day, you sell first and move into a rental while you look for your next house.

CellophaneFlower · 30/12/2024 11:24

Sometimes it all goes through and still you turn up to your new home and there's a family in it 🙈 Luckily when it happened to me they were at least in the process of vacating. Did mean I had to sit in a car for an hour that was crammed full of boxes, babies and a cockatiel though 😫😂

Original poster
ProssecoParent · 30/12/2024 11:27

3rdCoffeeThisMorning · 30/12/2024 11:17

It's really not that confusing. You just tripped ovwr and ended up lost in a forest of thoughts.
Example :
You selling house to buy another. Only 3 in chain.
You advertise yours in January and are looking for one to buy. Offer from your buyer accepted, your offer on new house accepted in February. All searches etc run at the same time for both properties. Everything is ready on 5th March. You all agree to exchange on 10th with completion on 20th March.
On 20th morning, your buyer pays you, you are out of house and they move in, your seller gets paid after lunch and they are out of the house and you move in.
Simple 😁
Stressful as fuck

(disgard u realise timescale in example😂)

Edited

That makes a lot of sense thank you! Yes I do think I've confused myself and my husband just says things in a jumble without actually explaining it to me properly.

OP posts:
Original poster
ProssecoParent · 30/12/2024 11:31

clary · 30/12/2024 11:16

Op you complete (ie actually sell) your house on the same day as you complete in the house you are buying. If lots of ppl do it at once it’s called a chain (which is why some ppl move to rented, or buy new build as this stops the chain). All the money is then transferred on the same day. Obvs a shorter chain is good (eg we sold to a FTB and our vendors moved to rented).

Have you never moved house before? Surprised a homeowner does not know this.

I'm not a homeowner, the house belongs to my husband who's not great at explaining things to me and is the type of guy that just says leave it all to me. But I like to know things especially when I'm buying the next house with him!

OP posts:
Original poster
ProssecoParent · 30/12/2024 11:33

I understand now thanks guys. The chain sounds tedious so we're probably going to sell the house and move in with my husband's parents to hopefully make the process faster.

OP posts:
DangerMouseAndPenfoldx · 30/12/2024 11:36

ProssecoParent · 30/12/2024 11:31

I'm not a homeowner, the house belongs to my husband who's not great at explaining things to me and is the type of guy that just says leave it all to me. But I like to know things especially when I'm buying the next house with him!

Show quote history

I’m certainly no expert, but if the old house is in his name, if you buy the new house in your name you wouldn’t be liable for the additional stamp duty because you (individually) don’t own two houses.

Depending on the value you might also get a reduced rate due to being a first time buyer.

CellophaneFlower · 30/12/2024 11:37

ProssecoParent · 30/12/2024 11:33

I understand now thanks guys. The chain sounds tedious so we're probably going to sell the house and move in with my husband's parents to hopefully make the process faster.

If this is a possibility it will also put you in a much better position to secure the house you want for a good price. Cash buyers are much preferred!

Original poster
ProssecoParent · 30/12/2024 11:40

The house would be in both of our names so wouldn't he still have to pay stamp duty?

OP posts:
DangerMouseAndPenfoldx · 30/12/2024 11:42

ProssecoParent · 30/12/2024 11:40

The house would be in both of our names so wouldn't he still have to pay stamp duty?

If in both your names, yes. If just in your name, no.

TheCheeseTax · 30/12/2024 11:46

Unless you're married. At that point you'll be (for all intents and purposes) the same status as your spouse/civil partner.

cavapoochris · 30/12/2024 11:51

To be honest, the chain system is so batshit that thinking it's batshit is entirely reasonable! Hope it goes well for you!

Daffy25 · 30/12/2024 11:54

If you want to buy before selling your current house then just pay the additional stamp duty. Then once your current house sells (as long as it’s within 3 years) you can then claim the back the additional stamp duty. I did this last year.

Original poster
ProssecoParent · 30/12/2024 12:00

Daffy25 · 30/12/2024 11:54

If you want to buy before selling your current house then just pay the additional stamp duty. Then once your current house sells (as long as it’s within 3 years) you can then claim the back the additional stamp duty. I did this last year.

How long does it take to receive the stamp duty back?

OP posts:
clary · 30/12/2024 12:38

@ProssecoParent are you aware that you need to pay stamp duty that you cannot claim back, on the price of the house you buy – anything above £250k? It’s 5% so if (for example) the house you buy costs £400k, then your stamp duty is 5% of the amount above £250k, so 5% of £150k = £7,500. Obvs less if the price of your house is lower. If you buy a house below £250k (perfectly possible in some areas) then stamp duty is zero.

(From April 2025 there is a new rate of 2% on homes above £125k, as well as the 5% on £250k+)