The zero per cent rate on Stamp Duty holiday was reduced to apply to purchases of homes up to the value of £250,000 from £500,000 from 01 July and reverts to the original £125,000 from today. First-time buyers will continue to pay no stamp duty on the first £300,000 of homes worth less than £500,000.
Newly released data from Key shows the pay-outs for house deposits peaked in June this year at £40.838 million as the £500,000 nil rate ended. The second biggest month was September 2020 when gifts were £40.622 million.
They hit a low of £13.16 million in February this year in the run-up to the original deadline of 31 March for the Stamp Duty Holiday before it was extended in the Budget. While those providing financial support for a deposit are cutting it fine in respect of the end of the Stamp Duty Holiday, £16,099 million has still been gifted thus far in September indicating the Bank of Gran and Grandad will keep on giving well beyond the end of this particular tax break.
The average gifted for house deposits each month during the near 15 months of the Stamp Duty holiday so far is around £29 million or £56,000 per person, Key’s figures show.
Will Hale, CEO at Key, said: “Over a 19-month period, more than £437 million worth of housing equity has been ‘recycled’ – moving from one generation to another to support their housing ambitions.
“While the Stamp Duty holiday helped to supercharge the older generations’ desire and ability to get children and grandchildren on the property ladder, the end of this incentive is unlikely to dim this appetite.
“Homeownership remains an ambition for many people – one that over-55s are eager to support - so all the signs suggest that many first time buyers will still benefit from older relatives’ generosity as well as no stamp duty on properties worth less than £300,000.”
