Say Goodbye to Stamp Duty: The Ultimate Guide to First-Time Buyer Stamp Duty Relief!

/

Blog

The Insider @ Houst
Last updated on
June 30, 2023

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Suspendisse varius enim in eros elementum tristique. Duis cursus, mi quis viverra ornare, eros dolor interdum nulla, ut commodo diam libero vitae erat. Aenean faucibus nibh et justo cursus id rutrum lorem imperdiet. Nunc ut sem vitae risus tristique posuere.

Say Goodbye to Stamp Duty: The Ultimate Guide to First-Time Buyer Stamp Duty Relief!

I hope you enjoy reading this blog post.

If you want my team to just manage your Airbnb for you, click here.

Airbnb Management Services by Houst | Short-Term Rental Experts

About Houst

Houst is a leading property management company specialising in short-term and medium-term bookings in eight countries. With over 7 years of experience and managing over 300,000 bookings, we help homeowners make the most of their properties.

Learn More

Congratulations on taking the first steps towards buying your first home! Saving for a home can be challenging, but what if we told you there's a way to scratch off stamp duty from your list of expenses? That's right! With first-time buyer stamp duty relief, you can completely avoid paying this tax or at least reduce the amount.

In this blog, we'll break down the details of this relief, making your home-buying journey much easier.

Table of Contents

Understanding Stamp Duty: The Basics

Let's start with the basics—what is stamp duty? It's a tax called Stamp Duty Land Tax (SDLT) that you have to pay when purchasing property or land in England or Northern Ireland above a certain price. Scotland and Wales have their versions of this tax with different names.

Here's the deal: If the price of your property is below £250,000, you're in luck because you won't have to pay any stamp duty. But if it's above that threshold, the stamp duty rate depends on specific bands. Essentially, the more expensive the property, the higher the stamp duty. The good news is that stamp duty is calculated based on the portions of the purchase price within each band rather than applying the highest rate to the entire price.

Continue reading: Stamp Duty 101: A Complete Guide About Payments and Regulations

Introducing First-Time Buyer Stamp Duty Relief

To ease the burden on first-time buyers, the government introduced first-time buyer stamp duty relief in November 2017. This relief provides a higher stamp duty threshold for eligible buyers.

So here's the scoop: If you qualify as a first-time buyer, you get a sweet deal. You won't have to pay any stamp duty if your property is worth £425,000 or less. But starting April 1, 2025, that threshold will decrease to £300,000. Trust us; this relief can make a huge difference, allowing you to use your savings for a larger deposit or other essential expenses.

Qualifying for First-Time Buyer Stamp Duty Relief

Now let's dive into who qualifies for this fantastic scheme. To be considered a first-time buyer, the property you're purchasing must be your main residence and the first property you've ever owned in the UK or anywhere else.

But wait, there are a few exceptions. If you've inherited or been gifted a residential property before or plan to use your new property for buy-to-let purposes, sorry, but you won't be eligible for first-time buyer stamp duty relief. Also, if you're buying jointly with someone else, both buyers need to meet the first-time buyer definition. It doesn't matter if you previously owned a property together as joint tenants or tenants in common—previous joint property ownership disqualifies you both.

Stamp Duty Rates for First-Time Buyers

Now let's get to the exciting part—how much can you save with first-time buyer stamp duty relief? Here's the breakdown: If your property is worth up to £425,000, you won't have to pay any stamp duty. If it falls between £425,000 and £625,000, you'll pay a 5% stamp duty rate on the portion above £425,000.

But, and it's a big but, if your dream home exceeds the £625,000 mark, you won't be eligible for first-time buyer stamp duty relief. Normal stamp duty rates will apply. Starting from April 1, 2025, the relief threshold will decrease to £500,000, aligning with reducing the nil-rate band for first-time buyers to £300,000.

The Impact of the Stamp Duty Holiday on First-Time Buyers

During the stamp duty holiday aimed to boost the housing market, first-time buyers enjoyed the higher nil-rate threshold of £500,000. This meant you could purchase a property valued at up to £500,000 and pay no stamp duty. However, now that the stamp duty holiday has ended, the usual first-time buyer stamp duty relief threshold of £300,000 has been reinstated.

The Impact of the Stamp Duty Holiday on First-Time Buyers

Mortgage Types Eligible for First-Time Buyer Stamp Duty Relief

Now that you know all about the relief's benefits and eligibility, let's discuss what is a mortgage by the types that qualify:

  • Joint mortgage: If you're buying a property with someone else using a joint mortgage, you can still benefit from first-time buyer stamp duty relief. The only requirement is that both buyers meet the definition of a first-time buyer.
  • Guarantor mortgage: With a guarantor mortgage, you can claim first-time buyer stamp duty relief as long as your guarantor's name isn't on the title deeds of any property.
  • Shared ownership: Whether you pay stamp duty on the full market value or only on the share you initially purchase, you can still enjoy stamp duty relief with shared ownership. However, keep in mind that if you buy more shares in the property (known as staircasing), you won't be eligible for the relief, and stamp duty will become payable if your stake rises above 80%.
  • Gifted deposit mortgage: Assuming you're receiving a genuinely gifted deposit, and the person gifting you the deposit won't be listed on the title deeds, you'll be eligible to claim stamp duty relief.

Congratulations on learning about the fantastic opportunity of first-time buyer stamp duty relief! It's a game-changer for aspiring homeowners like yourself. You can save significant money by meeting the eligibility criteria or even avoid paying stamp duty altogether. This extra financial breathing room can be used to increase your deposit or cover other essential costs associated with buying your first home.

Remember, purchasing a home is an exciting but complex process. Seek guidance from mortgage professionals and legal experts to ensure a smooth and successful experience. Now that you're armed with this knowledge go forth confidently, and embark on your home-buying journey. Good luck and happy house hunting!

Continue reading: Second Home Council Tax: How to Minimise Payments and Find Discounts

Simplify Your Homeownership Journey with Houst

Ready to take the leap into homeownership as a first-time buyer? Make your journey even smoother with the help of Houst, a trusted partner in property rental management. Whether you're looking to navigate the rental market, manage your property, or ensure a hassle-free experience, Houst has you covered. Let Houst be your trusted partner in property management, specialising in Airbnb rentals and more. With Houst, you can seamlessly navigate the rental market. Their comprehensive range of services is designed to help you achieve your real estate goals effortlessly. Visit Houst's website at Houst to learn more and get started on your path to homeownership.

The Insider @ Houst

The Insider @ Houst

The Insider team at Houst is dedicated to providing up-to-date and relevant information on short-term rentals. If you have hosting inquiries, please write to us at expert@houst.com. For guest inquiries, reach out at guest@houst.com. We are here to help you navigate the world of short lets and look forward to assisting you with your needs.

The Insider @ Houst

The Insider @ Houst

The Insider team at Houst is dedicated to providing up-to-date and relevant information on short-term rentals. If you have hosting inquiries, please write to us at expert@houst.com. For guest inquiries, reach out at guest@houst.com. We are here to help you navigate the world of short lets and look forward to assisting you with your needs.

Commission-Based
Pricing From

12%
of your
rental revenue
The commission depends on
the property profile and location

Complete property management services

We streamline the process of short-term lets and assist in maximising your rental revenue in London.

Listing Management

  • Multi-platform listings
  • Professional photography
  • Listing creation
  • Price optimisation

Guest Management

  • Guest vetting
  • Guest check-ins
  • Linen and toiletries
  • Guest communications

Property Management

  • Cleaning and housekeeping
  • Property maintenance
  • Property insurance
  • Property management software
David
Account Manager

"I have a philosophy in life called keep it simple. I don't live to work, I work to live. This is the first time I've leased this property on Airbnb. A house allows me to have vision of all the revenue and all the expenses associated with the apartment. They work as a well-oiled machine. They strive very hard to keep both myself and the tenants happy."

Jules
Sales Director

"Honestly, if I didn't have Houst, I don't think I'd have this house anymore. With Houst's help, I can focus on my busy life while they manage my Airbnb listing. Guests call this place the 'magic cottage', and Houst makes it possible to share its special charm without any stress."

Charlotte
Musician

"Houst has been a game-changer for us, enabling my husband and I to expand our property portfolio effortlessly. Their personalised service lets us be hands-off yet fully in control, making property management seamless while we pursue our careers as musicians."

Ahmed
Software Engineer

"Houst has been a game-changer for my Airbnb rentals, significantly boosting my income. Their user-friendly platform and comprehensive management services, covering everything from cleaning to guest interactions, make property management stress-free."

Jim
Construction

"Finding Houst has been like a godsend for my Airbnb venture. It's made the entire process really easy, from the onboarding to managing guests. Their seamless service has enabled me to host successfully without needing to invest my limited time. If it weren't for Houst, I wouldn't be hosting on Airbnb."

David
Account Manager

"I have a philosophy in life called keep it simple. I don't live to work, I work to live. This is the first time I've leased this property on Airbnb. A house allows me to have vision of all the revenue and all the expenses associated with the apartment. They work as a well-oiled machine. They strive very hard to keep both myself and the tenants happy."

Jules
Professional Landlord

"Honestly, if I didn't have Houst, I don't think I'd have this house anymore. With Houst's help, I can focus on my busy life while they manage my Airbnb listing. Guests call this place the 'magic cottage', and Houst makes it possible to share its special charm without any stress."

David
Account Manager

"I have a philosophy in life called keep it simple. I don't live to work, I work to live. This is the first time I've leased this property on Airbnb. A house allows me to have vision of all the revenue and all the expenses associated with the apartment. They work as a well-oiled machine. They strive very hard to keep both myself and the tenants happy."

Jules
Sales Director

"Honestly, if I didn't have Houst, I don't think I'd have this house anymore. With Houst's help, I can focus on my busy life while they manage my Airbnb listing. Guests call this place the 'magic cottage', and Houst makes it possible to share its special charm without any stress."

I hope you enjoy reading this blog post!
If you want my team to just manage your Airbnb for you, just book a call.
Book a call
Click here to Get More Bookings!
See How Houst Can Elevate Your Airbnb’s Visibility
  • Listing Optimisation – Maximise your listing’s potential. Experience tangible growth.
  • Professional Photography – Captivating visuals that instantly attract guests.
  • Guest Screening – Ensuring only the best and safest guests for your property.
BOOK A CALL
Close

We hope you enjoy our blog!

If you would like to find out more about how our team can help you get the most of your Airbnb, just book a call with us.

Thank you for providing your contact information!
Oops! Something went wrong while submitting the form.