First-time buyers in England are confused about changes to Stamp Duty Land Tax, over-estimating how much they can save on the duty and even unconvinced that changes to the system are good news for them.
Research by online broker L&C Mortgages exposes the confusion many newcomers to buying a property feel when confronted with stamp duty. Homeward Legal's expert team always explain in detail when and how stamp duty is paid, ensuring even those new to the conveyancing process are clear about the duty.
A third (31 percent)of those quizzed for L&C admitted they don't know if the first-time buyer exemptions introduced for English buyers in the 2018 Budget are good for them.
Stamp duty is paid to HMRC and the rate depends on the sale price of the property. The zero rate applies to any property valued up to £125,000, then from 2 percent up to 12 percent.
From November 2017, first-time buyers in England are exempt from paying stamp duty on the first £300,000 of any property transaction, with 5 percent duty levied on any property valued up to £500,000. You can find out more about stamp duty and first-time buyers in our extensive guide.
In the L&C research, 13 percent of first-time buyers wrongly think the stamp duty change could save them more than £5,000, while more than half (52 percent) believe they will benefit from the exemption.
Demonstrating the lack of knowledge on when stamp duty is due, 42 percent of those quizzed thought the exemption would not apply to them when buying a home priced between £125,000 and £500,000 or were unsure if it would apply.
A fifth (22 percent) did not change their minds on the price they were willing to pay for a property following the changes, but 38 percent had no idea how much they would save if they didn't have to pay stamp duty.
Six out of 10 first-time buyers want stamp duty abolished for all first-time buyers, regardless of the price they pay for a property, while 38 percent say the value of properties excluded from stamp duty should rise with house prices.
David Hollingworth of L&C said: "More needs to be done in order to ensure that first-time buyers know what is available to them.
"The stamp duty relief is welcomed by many who are looking to buy their first home, but the new rules could be considered complicated to someone who hasn't been through the process of purchasing property before."
First-time buyers are in professional hands when they choose Homeward Legal to provide a conveyancing quote. We work with an experienced, certified panel of property lawyers based across England and Wales who can provide the legal services you need at a value-for-money price.
Homeward Legal is always transparent about the fees involved in conveyancing, and when you get a quote, we will detail the potential stamp duty liability, ensuring you are fully informed from the start.
Talk to us now on for a no-obligation quote for first-time buyer conveyancing.