Scotland’s housing market is experiencing a post lockdown boom, following months of inactivity due to coronavirus restrictions.
With homes finally coming to the market again, asking prices reaching a record high, and properties being snapped up at closing dates, solicitors and estate agents in Perth are seeing a surge of activity.
Buying your first home is both exciting and daunting, but getting on to the property ladder can sometimes be challenging.
Following on from the Chancellor of the Exchequer Rishi Sunak, the Scottish Government has also announced a temporary holiday on LBTT (the equivalent of Stamp Duty in England) in order to get the housing market in Scotland moving again.
In Scotland, homebuyers have been required to pay Land and Buildings Transaction Tax (LBTT) on residential properties over £145,000, with the exception of first-time buyers in Scotland who are not required to pay LBTT on a property purchase up to £175,000. However now the threshold has been increased to £250,000 – this is a temporary cut running until 31 March 2021.
It's good news for those who have been waiting to move house but have been held up due to the coronavirus pandemic and the restrictions placed on us all. In a statement to Parliament last week, First Minister Nicola Sturgeon announced that we are moving into Phase 2 of the Scottish Government’s route map to ease Coronavirus (Covid-19) restrictions, meaning that restrictions on house moves will be relaxed on 29th June.
The majority of house moves have been put on hold during lockdown whilst the message in Scotland is still to ‘Stay At Home’. This has put increased pressure on those in the midst of moving, especially those who have ended up with two properties because one has not been able to be sold due to the current restrictions.
If you own two properties on the date of settlement and you are not replacing your main residence, a tax called Additional Dwelling Supplement (ADS) is payable. ADS, which is currently charged at 4% of the whole purchase price, applies to all transactions involving the purchase of an additional residential dwelling over £40,000, including buy to let investments and second homes.