What is the new UK stamp duty all about and what does it mean for the property market? This is a common concern as many people are still unsure of what this new stamp duty threshold will mean. Here is an overview of the differences now in effect and what this could mean to the home buyer and the property investor.

The rise of the rate of the stamp duty from £125,000 to £175,000 could mean big changes for house buyers and sellers in and across the UK. Beginning September 3, 2008, there are new thresholds on the Stamp Duty. If the purchase price is under £175,000, you don’t have to pay the Stamp Duty at all.  This is a temporary measure but may be here to stay.

Here is a chart that shows the current rate of the Stamp Duty Land Tax:

These new thresholds will change the amount of taxes involved in purchasing property in the UK and could be a good thing for many investors. There is also a change in property purchased in government designated “disadvantaged” areas. Properties that previously qualified under the Disadvantaged Area Relief will now qualify under the higher threshold of the Stamp Duty.

What this means

New research has shown that this stamp duty break could inject new life into certain areas such as North East England and Wales. This could increase the population and create new opportunities for UK property investors. Statistics show that around 50% of the properties recently sold in England and Wales were sold below the threshold for the Stamp Duty tax to be in effect. In the North East, you can find an even better bargain at nearly 78% of the properties there falling below £175,000.

First time buyers may flock to these areas for the affordable pricing and the stamp duty tax break but this is also good news for investors looking to expand or even the person just starting out in UK property investing and looking for a good deal.

Other nice areas for the UK property investor to look into are Scotland where 68% of homes are sold for under £175,000 and the North West (72%), Yorkshire and the Humber (72%) and Wales (71%). Buyers looking for a deal are encouraged to avoid London where only about 13% are sold under this threshold and specifically the areas of Hammersmith and Fulham in west London where only 1% of homes sold were under £175,000.

Research shows that there are certain areas that just aren’t worth the expense for a first time home buyer or investor. You should seek areas such as Chester-le-Street in County Durham of the North East, where 94% of properties avoid stamp duty. This can be a great option in affordable housing and can save you as much as £1,750 in additional home buying costs.

Making use of the stamp duty thresholds

As an investor, you can make use of the stamp duty thresholds as we mentioned above. When you shop around for the most ideal locations to invest in property, you can find some great deals. Many investors also find it beneficial to seek the services of a referral company. Often you can find out about properties and deals that you would not have been able to find without them so the expense can be well worth it.

Buying properties below the stamp duty thresholds helps you save more on your purchases with makes it easier to see a profit in your investments.

Popularity: 40% [?]