Stamp Duty Relief Announced for First-Time Buyers, Ten Questions to Ask at a Viewing, Plus More

Welcome to Town & Country's December newsletter.

In this edition, the government has announced stamp duty relief for first-time buyers and a recent study has revealed how long it takes to sell a home.

Also this month, we share ten questions that you should consider asking whilst attending a viewing and it has been revealed how much the average homeowner will spend on updating their home in the first five years.

Government Announces Stamp Duty Relief For First-Time Buyers

 

In a bid to improve homeownership throughout the UK, It was announced in the latest autumn budget that first-time buyers will no longer face the cost of stamp duty.

There were many changes announced by the government in the most recent budget, but the major headline was the scrapping of stamp duty for first-time buyers on all properties up to a value of &300,000.

This change will take effect immediately and could save first-time buyers a potential &5,000 in fees when completing on their home.

What is Stamp Duty?

Stamp duty is a tax applied to any property purchase priced at more than &125,000. The latest reform will see the minimum stamp duty limit increased to &300,000. This means that according to statistics, approximately 80% of first-time buyers will save money on stamp duty fees.

For first time buyers buying a property within the range of &300,000 to &500,000, they will pay less stamp duty as the rate has been set at 5%. While buyers in this price range won’t avoid the tax completely, buying a home valued at &500,000 will now cost you &5,000 less.

How could this move affect the market?

While it is still very early days and it may be some time before we see a reaction from the market to this reform, some experts are suggesting that vendors will simply respond by raising the price of their home.

The Office for Budget Responsibility shared this opinion saying that “…the main gainers from the policy are people who already own property, not the FTBs themselves"

Other experts believe that house prices are the real problem and while the scrapping of stamp duty will save first-time buyers some money, it doesn’t mean that they will rush to buy a home now that this reform is in place.

Tom Kibasi of the Institue of Public Policy Research commented, saying “Unaffordable house prices are the problem, not Stamp Duty. For most young people, the stamp duty cut will make little difference. But it will help the beneficiaries of the bank of mum and dad.”

How Long Does It Take On Average To Sell A Home?

 

 

As any homeowner who has sold a home will know, the waiting is the hardest part, especially when the seller has unrealistic expectations of how quickly their property will go from for sale to sold.

Post Office Money and the Centre for Economic and Business Research carried out research looking into the average time it takes to sell a home in 22 of the major cities throughout the UK. On average, it was found that on average it takes 82 days to sell a property.

The findings of this research showed that Edinburgh is the fastest place to sell a home, with most properties only being on the market for an average of 41 days. Similar results were found elsewhere in Scotland as Glasgow was the 2nd fastest city to sell a home at an average selling time of 50 days and in 3rd place was the city of Bristol showing a 61-day average before agreeing on an offer.

It has been suggested that properties within these cities move so quickly due to their price range and are more suited to first-time buyers that are willing to be more flexible on the location of their first home.

The research found that Belfast was the slowest of the major cities to sell a home and average selling times were around 119 days.

Liverpool and London also featured at the lower end of the table, averaging at 112 and 111 days respectively, as it seems the more densely populated areas of the UK present more competition amongst other homes on the market.

The market has seen a bit of a slowdown in activity in recent months due to the questions surrounding the UK economy as Brexit negotiations continue and property prices are still rising, showing a 5% increase throughout the UK over the last year. Both of these factors could be linked to some of the slower cities, more populated by second steppers possibly taking a more patient approach to the market.

Managing Director at Post Office Money, Owen Woodley offered his comments on the results. “Against a backdrop of muted but steady increases in house prices across the country and sustained demand from the FTB market, these movements in time to sell reflect the changes in the number of properties listed for sale in cities across the UK. We know from previous research that first-time buyers are taking a flexible approach to finding an affordable home, most especially towards location.”

 

10 Vital Questions to Ask When Viewing a Property

 

 

The process of buying a home is the most important decision you will ever make, so when you do finally decide to put an offer on a house, you need to be certain that it’s on the right house. How can you be sure you’ve found the right property? By taking your time when viewing a home and asking the right questions. You’d be surprised at some of the questions people forget to ask and end up regretting it months down the line when they discover something about the home that they don’t like.

To make sure that you find the property most suitable for you, we’ve compiled a list of 10 questions that are definitely worth asking when viewing a property.

How long has the property been on the market?
A great place to start as it can give you a good insight into the property immediately. If a property has been up for sale for nearly a year, you might want to think about why no one has picked it up so far. A house that has been on the market for a long time isn’t always a sign of something sinister, but knowing how long it has been on the market does give you a little more perspective and is a good starting point to any viewing.

How much interest has there been?
This is a good follow-up question to the previous. Especially if you think you’ve found your dream home. If there have been a lot of viewings or even a couple of offers then you know straight away that you need to act quickly.

How long have the current owners been here?
When viewing a property, most people are thinking long-term and looking for a home they can see themselves in for years to come, so it’s worth finding out if the previous owners did just that. If there have been multiple owners in and out of the property over the last 5 years, then you need to think, why?

Have there been any recent repairs or renovations?
What you have to keep in mind when viewing a property is that you’re most likely viewing it in its cleanest and brightest state. The current owners are trying to sell this home and to do that they’ll do their best to wow you at every opportunity. Try not to simply glance at the rooms and move on, ask questions about the state of the home, have there been any repairs recently? Will the home need any repairs in the future? If you’re making an investment, you want to know

What’s included in the sale?
While you wouldn’t expect the seller to leave behind their 60 inch HD TV, some of the items in the home may be left behind. This mainly applies to the kitchen area and items such as cookers, washers, dryers. It’s best to ask what’s included in the home so you know what extra purchases you’ll need to make if you end up buying the home.

Can we test the plumbing and electrics?
Sellers may not make you aware of any electrical or plumbing issues so it would be best to check everything is in working order. Check the water pressure and try turning all of the lights on and off. This doesn’t mean that you should consider any faults with electrics and plumbing as deal breakers, but you need to know exactly what needs fixing.

What’s the neighbourhood like?
You can take a walk around the area yourself and get a feel for things, but a good agent should know the area pretty well and be able to give you more information. Ask about the local schools, shops and if there have been any major changes in the area recently. After all, you’re not just investing in the home, you’re also investing in the neighbourhood itself.

What transportation links do we have easy access to?
If you or members of your family need to use public transport, find out about the transport links. How far away are the train stations and bus stops? How frequently do they run in this area? If you’re going to be using public transport daily, you need to know if the commute from your new home is suitable.

How is traffic during rush hour?
For those of you that get around the city in a car, finding out how easy it would be to get from point A to point B during peak times could be quite important. If you need to drop the kids off at school and try and get to work before 9:00 am, it’s best to find out how much of a challenge that will be on a daily basis.

Can we book another viewing?
If you make it through the viewing and still feel positive, ask if you can come back again at a different time of day to see if you feel the same. Try visiting when it’s less bright when the property looks less like a show home or when the area is less quiet during rush hour and find out whether noise could be an issue.

Buyers Spend £10k Updating Their Homes In The First 5 Years

 

A recent study looking into the amount that homeowners spend on a new property has found that on average homeowners spend &10,743 within the first five years of moving into their new home.

This survey was conducted by Furniture Choice, surveying 1,000 homeowners and looked into the most common purchases for a new home and the average cost each of these items or upgrades.

According to responses, new homeowners spend just over &2,000 on basic furniture such as sofas (costing an average of &669), Beds (&381), wardrobes (&314) and dining sets (&308) meaning buyers need a little bit more than a deposit to get started.

The kitchen also appeared to be quite costly, as homeowners spent just over &1000 on white goods and cooking appliances.

It can be quite common for homeowners to run into unexpected costs such as faulty plumbing and electricals within the first few years in a new home also. These issues along with other general repairs came in at an average cost of &3,500 according to responses.

While some buyers are prepared to get stuck into a fixer-upper, some survey participants revealed that they still had to put some cash into upgrading a recently renovated home.

Survey participant India Benjamin, spent close to &2,000 fixing unexpected faults, showing that buyers need to be thorough when viewing a home and fully understand the costs involved. “The house was newly renovated when I bought it, but only on the surface. I had to replace the boiler within six months of buying the house; apparently, it was nearly ten years old, despite being in a brand new cupboard, and I’ve been advised my whole toilet cistern needs replacing.” Said Benjamin.

Furniture Choice's Tom Obbard, spoke on the findings of the survey, stating that “Buying a new property is stressful enough as it is, so it’s vital that potential buyers are aware that solely saving for a deposit isn’t enough anymore, especially when it comes to first time buyers.

“Budgeting for furniture can begin before you even look for a house; starting a Pinterest board or even a spreadsheet to get an idea of cost, as well as style, can really help to give an indication of how much you will need to save. Stick to the basics at first; a bed, sofa, and dining sets are always good to start with. Smaller items can be bought gradually if you’re on a tight budget."

“Some costs, such as repairing hidden damage, can’t be foreseen, but having an emergency buffer in place will help to limit any financial strain these problems have".