The Scottish Budget's impact on housing
Finance secretary John Swinney yesterday announced the Scottish Budget for 2016/2017 and it includes some changes that could affect the housing market.
Land and Buildings Transaction Tax (LBTT)
The rates and bands will remain unchanged, as the revenue forecasts for LBTT are on track, according to Mr Swinney. You can find out more about the different rates here.
£70m has been set to continue the freeze on Council Tax, which has been in place for the past nine years.
The budget for affordable housing will be increased by £90m, making the total overall budget £690 million. The government says it’s on track to meet its target of 30,000 affordable homes and with a new target to deliver 50,000 affordable homes during the next parliament.
Second homes and buy-to-let
The Scottish Government’s announcement to introduce a 3% additional levy on the purchase of a second home and buy to let properties from April 206 could have some impact on buy-to-let investors.
This supplement will be 3% of the total price of the property for all relevant transactions on or above £40,000, and will be in addition to the current Land and Buildings Transaction Tax (LBTT).
Orlaith Borgan, ESPC Lettings manager, said: “Buy to let investors must strongly consider what they are looking for before investing to ensure that it will meet all of their needs. These budget changes further highlight the importance of proper planning before choosing to invest.
Many investors work hard to get the minimum 25% deposit together and to ensure that they can secure a mortgage. This increased cost may mean that some investors have to look in areas that were not their first choice so they can afford a property.
Taking a balanced look at the changes, it’s important that first time buyers can get onto the market, but it’s also important to have a strong private rented sector as people will always require rented accommodation as well as being able to buy.
If you would like more information on the Budget and how it could affect you, call into our showroom to speak with one of our experts or call 0131 624 8000.