How much does the Labour government's housing policy cost?

The cost of purchasing a home will increase by thousands as thousands of buyers will miss the stamp duty deadline

The benefit of higher stamp duty thresholds for first-time homebuyers and movers is only available for one month.

Stamp duty thresholds for first-time buyers and home movers are expected to decrease in April, which means that if you aren't already in the conveyancing process, you will probably have to pay more for your property purchase.

Currently, the first 425,000 of a property purchase is free for first-time buyers. As of April, this will drop to 300,000. Other purchasers will pay stamp duty starting at 125,000 rather than the current threshold of 250,000.

Due to the rush of transactions brought on by the changes, home prices have increased as buyers try to reduce the cost of buying a property.

According to Rightmove's research, 25,000 first-time buyers in England are presently completing the legal requirements for a property purchase; it is anticipated that they will miss the stamp duty deadline on March 31 and finish in April. This is predicated on how quickly homes typically sell in the neighborhoods where they are currently for sale. A purchase will cost thousands more if it is not finished by April.

This is on top of other growing moving expenses like paying for removals and surveys.

In England, the average home mover will have to pay an additional 2,500 in stamp duty starting in April. While first-time homebuyers who spend £300,000 or less will still not be required to pay stamp duty, Rightmove cautions that first-time homebuyers who spend between £500,001 and £625,000 will be the most impacted, incurring an additional 11,250 in expenses.

According to real estate website Zoopla, 83 percent of prospective buyers who are currently in the market will pay more in stamp duty starting in April 2025, up from 49 percent at the present time.

What is the cost of moving to the UK?

When purchasing a home, there are many up-front expenses in addition to the mortgage payment and the purchase price.

In addition to surveys and removals, buyers frequently have to pay legal fees.

If you are also selling a property, you might also have to pay estate agency fees.

Homeowners who purchase and sell a property in 2024 must pay 13,978 in upfront costs, according to a reallymoving analysis based on quote requests on its comparison website.

Stamp duty, conveyancing, estate agent fees, an energy performance certificate, a Level 2 homebuyer survey, and removal expenses are all included in this.

A large portion of the cost is related to home values.

In England, the average cost of a home move is 30,048 for movers in the capital, while the lowest cost is 5,492 for those in the North East.

Are the costs of moving homes going up?

It goes without saying that moving expenses will rise in tandem with home prices.

The Labour Government isn't really to blame for that. However, the cost of moving will be influenced by its stamp duty policy.

Stamp duty thresholds will be lowered starting in April 2025.

The relief for first-time buyers will be reduced from 425,000 to 325,000, and those selling and moving up the ladder will have to pay stamp duty at the 2 percent rate again, starting at 125,000 instead of the current 250,000.

According to a Zoopla analysis, one-third of buyers are currently looking for homes between the price ranges of £125,000 and £250,000. The impact will be particularly noticeable in the Midlands and Northern England, where up to 67% of sales fall into this range.

According to Zoopla, nearly 50% of sales that surpass the £250,000 threshold will incur an additional 2,500 for each sale.

According to the research, an additional 20% of first-time buyers will also be subject to stamp duty, primarily affecting those in southern England because 30% and 34% of first-time buyers in the East, South East, and London regions aspire to purchase homes in the 300,000 to 425,000 price range.

Zoopla issues a caution. that buyers' willingness to pay in 2025 will be impacted by rising purchasing costs, which could impede the growth of home prices by up to 1%.

Moving costs will increase to 16,478 if stamp duty thresholds are lowered, according to Reallymoving.

Once the lower threshold is reinstated, movers in the North East and Northern Irelandwho currently enjoy the benefit of paying no stamp duty based on the median purchase pricewill have to pay 2,400 and 2,500, respectively.

Additionally, according to the study, the percentage of first-time buyers who pay property taxes will more than double, from the current rate of 17% to 39%.

According to Rob Houghton, founder of reallymoving, "Raising nearly 14,000 to finance a home move is a major challenge for many people, especially with the cost of living so high making it even harder to save."

"In recent weeks, the percentage of first-time buyers has increased as more people speed up their plans to move in order to benefit from lower stamp duty bills before they rise next spring. However, time will be of the essence for many, so it's prudent to budget for higher stamp duty costs just in case."

When it comes to conveyancing, surveying, and removals, he says it's always crucial to compare prices and reviews to get the best offers.