Stamp duty

Stamp duty originated in the 1600s to fund the war against France and it has somehow carried on to the present day.

Unfortunately, for a seller, it can be the reason why a buyer would pull out of a sale especially if your house is priced around the thresholds as shown below:

Purchase Price

Rate

up to £125,000 0%
from £125,001 to £250,000 1%
from £250,001 to £500,000 3%
from £500,001 to £1,000,000 4%
over £1,000,000 5%

 

As can be seen, there is such a jump in the rate as soon as a house is bought for £250,001.  A buyer in this case would then be paying £7500.03 as opposed to the £2500 he/she would pay if it cost £1 less.  That is a whole £5000.  Definitely not to be sniffed at.  If you are trying to sell a house that is in this price range(even up to £270000) then you should definitely consider reducing the price, it could mean the difference between being on the market indefinitely or not.  Of course, if your buyer is a first time buyer then they will not have to pay the tax.

Annoying though it is, it is a reality that you the seller must do whatever is necessary to ensure you sell your property in this market.  If you have the equity in the property then if you must move house, it may be wise to reduce the price to £250000 and below.

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