Interest Rates Rise
In early November 2017, the Bank of England raised interest rates for the first time in more than a decade – this is a move welcomed by savers, but not by homeowners paying off mortgages!
The bank’s monetary policy committee (MPC) decided to double the base rate from its record low of 0.25% to 0.5%. This rise has result in nearly four million British households now facing higher mortgage interest payments, however hard-pressed savers should get a small lift in their returns.
Autumn Budget 2017: Stamp duty axed for first-time buyers
From 22 November 2017, the Chancellor Philip Hammond announced in the Autumn Budget that the first-time house buyers south of the borders will pay zero stamp duty on the first £300,000 of any home that costs up to £500,000 with immediate effect. This means on a home worth less than £300,000, you’ll pay no stamp duty at all. This move could save buyers up to £5,000!
Unfortunately, it is not good news for first time buyers in Scotland. The changes only apply to purchases by first-time buyers in England, Wales and Northern Ireland. Scottish buyers will have to wait and see if the Scottish Government will make a similar change north of the border in its own draft Budget on Thursday, December 14.
Stamp Duty in Scotland is now known as the Land and Buildings Transaction Tax (LBTT).
LBTT is not paid until a purchase price exceeds £145,000. Between £145,000 and £250,000 the rate is 2%, and rises to 5% between £250,000 and £325,000. From £325,000 to £750,000 the rate is 10%, and jumps to 12% above £750,000.
House Prices Rise and Lack of Supply
As a bustling capital city with lots to offer its residents, it’s no surprise that Edinburgh is a very desirable place to live. But with properties in high demand, prices are continuing to rise at an extraordinary rate.
According to research from ESPC, the average price for a home in the Scottish capital is £253,182. On average, it takes just 16 days for a property in Edinburgh to sell, and 77.8% of properties exceed their home report valuation.
In Edinburgh, those living in EH2 have seen their property values rise on average by nearly £50,000, or 14%, in just one year. This is perhaps unsurprising, given the easy access to the buzzing city centre.
The high prices and quick selling times are due to a shortage of suitable properties coming onto the market.
The shortage of properties coming to the market means that there are multiple buyers looking to buy the same property which encourages competitive bidding at a closing date. It is now common for such properties to sell 10% or more above the home report value.
We’re here for you
Thinking of selling your property? Feel free to get in touch with us by calling 0131 524 9797 to organise a free valuation of your home. Don’t forget we are open throughout the festive period.