On Thursday, the Chancellor announced he was scrapping Stamp Duty for first time buyers on the first £300,000 of properties worth up to £500,000.
This was a move that put housing and young people at the heart of the Budget, taking 80% of first time buyers out of Stamp Duty altogether — a huge win for anyone who wants to get on the property ladder.
So, if you’re looking for your first home, then read on. This blog looks at what it might mean for you and how you can build up a deposit more quickly, with a few money-saving tips.
How much will the Stamp Duty announcement save you?
The average first-time buyer house price in the UK is £200,000. On a property of this value, the purchaser would have paid £1,500 in Stamp Duty fees before yesterday’s announcement — that’s a healthy chunk of money!
So if you’re already saving for your first home, then the reality of purchasing a property may have just got a little closer.
Because, when house-buying, it’s not just a deposit you need to save for. It’s also conveyancing and solicitors’ fees, furniture, a removal van, the list goes on.
These additional costs can add up and hold people back from their goal of owning a home.
So with the positive news that you’ll have no Stamp Duty to pay (unless purchasing a house worth more than £300,000), we thought it might be useful to give you a few money-saving ideas.
We hope these will boost your deposit and help turn your dream into a reality:
1. Open a Help to Buy ISA
If you’re squirrelling your deposit money away in a standard saver account, then you need to open a Help to Buy ISA, today!
It provides first time buyers with a 25% cash boost on any savings, and you can make an initial deposit of £1,200. Thereafter, you can set a monthly direct debit of £200.
2. Use a cash back website
With Christmas on the horizon, and household items having a habit of going kaput without warning, you’re probably still going to have to make a few purchases while saving for a deposit.
3. Switch gas/electric
Martin Lewis suggests that gas and electric prices are set to rise in the next 12 months, so if you’re in a rental property, it’s important to lock yourself into a cheap tariff now.
You can use his comparison tool to find the best deal.
4. Cut back on going out
Many people will go out more on the run up to Christmas. But have you thought about inviting friends over instead of going out? Cook them dinner and buy in the wine rather than splashing out on a meal and drinks at a restaurant/bar.
5. Cancel unused memberships
No longer make use of your Netflix account and can’t remember the last time you went to the gym? Cancel your memberships! It could save you a lot over a year.
6. Make your own lunches
If you spend £5 on your lunch for work each day, it can amount to £1,200 over 12 months. Being prepared by making your own food the night or morning before can save you a big chunk of this costly habit.
By employing some of these money-saving tips, the purchase of your first home might come sooner than you think, especially now Stamp Duty has been scrapped for first time buyers.
So if this announcement has inspired you to get on the ladder, then get in touch with our Huddersfield-based mortgage broker. We can calculate your affordability in a no-obligation consultation:
Your property may be repossessed if you do not keep up repayments on your mortgage.
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