There’s been a shock one per cent increase in the Welsh equivalent of stamp duty on second homes, coming into effect tomorrow.
The move aims to raise £13m for new social housing and means second home-owners paying a four per cent levy when they buy homes up to £180,000, rising to 16 per cent for homes worth £1.6m or over.
The change to Land Transaction Tax - the Welsh version of stamp duty - comes into effect tomorrow.
The move is part of the Welsh Government's budget for 2021-22 and comes just two days after Wales entered its latest Coronavirus lockdown.
A statement from the Welsh Government this evening says: “If you complete on buying a property before 22 December you pay the previous rates of tax - on or after 22 December you pay the new rates of tax. In most cases where you have already exchanged contracts, but not completed you will be able to use the previous higher rates.”
The first reaction has come from John Stewart, deputy policy director of the National Residential Landlords Association.
He says: “This is simply unacceptable to increase the rate of additional property Land Transaction Tax in this fashion. This increase will destabilise the private rental market in Wales, increasing costs on buying homes with immediate effect. Anyone buying a new home, before they can sell their current principle residence, will have to find this extra money up front. This may also cause some transactions to collapse and cause further hold-ups for anyone caught in a chain.
“The start of a national lockdown is not the time to put additional burdens on a sector already facing some of the longest and most severe Coronavirus restrictions and will deter investment in rental properties that we so badly need.”