THOSE looking to buy properties for less than £500,000 will not have to pay stamp duty, after the chancellor announced an increase to the stamp duty threshold.

Announced as part of his summer economic update, chancellor Rishi Sunak confirmed the threshold for people having to pay stamp duty would increase from £125,000 to £500,000.

This increase would be in place until March 31 2021.

Speaking at the House of Commons, Mr Sunak said: “Right now, there is no stamp duty on transactions below £125,000.

“Today, I am increasing the threshold to £500,000. This will be a temporary cut running until March 31 2021 – and, as is always the case, these changes to stamp duty will take effect immediately.

“The average stamp duty bill will fall by £4,500. And nearly nine out of 10 people buying a main home this year, will pay no stamp duty at all.”

National house price indexes may report a drop in house prices during the first four months of 2020, as many face concerns over employment, particularly those on the furlough scheme. 

However, Symonds & Sampson’s Estate Agents across Dorset, Somerset and Devon reported a strong post lock-down market with prices holding firm.

Head of agency, Jon Summers, said: “All of our offices are experiencing a very high demand for property across the board.

“Applicant registrations, number of viewings, and sales agreed are at, if not exceeding last years’ figures, and on the rare occasions sales have fallen through, demand is such that generally new buyers were quickly found and sales agreed at much the same levels.

“This announcement is a welcome stimulus for what is already a buoyant bounce-back market in the region, which comes hand in hand with benefits to the wider economy by improving job and social mobility in particular.

“The changes announced will be particularly welcome news to first-time buyers, the foundation of the property market and sector who are arguably the most nervous about job prospects as the furlough scheme draws to a close, and where any assistance will particularly beneficial.”

Meanwhile, Jason Barnett, from Coles Miller based in Bournemouth, said: “The stamp duty holiday will benefit all parties purchasing homes during this period. The saving to purchasers can be fairly dramatic.

“The measures should see a real boost to the housing market which is slowly limping back into action following the period of lockdown.

“There is no better time to purchase a property or to consider a move than now – stamp duty rates have never been more favourable to purchasers.”