Property News: How Will The Stamp Duty Holiday Impact The Property Market? Expert Sam Fongho Shares His View.
/‘‘We expect to see a significant increase in trading activity in the South.’’ says property investment expert Sam Fongho of Midas Property Group.
I have been asked by the editorial team at various publications to share my opinion on how I believe the decision by the Chancellor to increase the threshold of tax to £500,000 from £125,000 will play out on the field.
Here below is my view, although investors and second home buyers will still have to pay the 3% surcharge.
Buy, Refurbish and Sell (BRS) strategy is when investors buy a rundown property, refurbish it with the intention of selling it on. Having to pay tax twice within a short period of time was a deal breaker. The stamp tax holiday will be a boost to this strategy.
Trading is when you buy a property with the sole intention of selling it on for a profit. The tax holiday will have a very significant boost to trading since the tax element made many deals in the South of England just not viable. We expect to see a significant increase in trading activity in the South.
Office to Residential Conversion is a strategy whereby developers buy qualifying office blocks and convert them into flats. These projects are often much quicker to deliver than new build projects. The tax holiday will make units under £500,000 more affordable and will fuel the sector.
New Build Developments developers who are actually building from the ground up should benefit significantly. The tax holiday will drive up demand for units completing now. The limited tax holiday will actually motivate most developers to fast track their projects and ensure completion within the tax holiday period.
Moms and Pops downsizing the tax holiday will help drive up the demand for those in big houses who might want to downsize. On the other hand, the fact that they can buy their smaller home tax free helps as well.
According to Sam, we might just see a surge in activity in the market right now! That is certainly great news for investors, buyers as well as sellers!
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