Kirstie Allsopp says pensioners should be paid to downsize because stamp duty currently stops them moving to smaller homes and freeing up cash to pay for their care
- Location Location Location presenter Kirstie Allsopp says system needs change
- She reckons stamp duty puts pensioners off downsizing ahead of final move
Kirstie Allsopp has called for pensioners to be paid to downsize as the current rate of stamp duty is discouraging them from moving to smaller homes.
The Location Location Location presenter said the tax in place at the moment puts off people from making the final move even though it might help them be cared for in later life.
Currently a pensioner selling a family home at £700,000 to buy at £500,000 would face a £15,000 stamp duty bill.
There have been calls to reform the system so that larger houses can be freed up for younger families who need the space.
Weighing in on the Difficult Women podcast, the 51 year old said: ‘You can fiddle around with stamp duty, it definitely doesn’t work.
Location Location Location presenter Kirstie Allsopp says stamp duty system needs change
‘The thing about it is, there’s all sorts of things I’d do with stamp duty.
‘I think the number one thing that is the problem with stamp duty, is it discourages people from making that final move.
‘So, older people say ‘ah I’m 70, I’m not going to downsize because I’m not going to spend this amount’.’
Asked by podcast host Rachel Johnson if they should be paid to downsize and not charged, she said: ‘Exactly.
‘That’s my problem with stamp duty, I think it prevents older people from making the final move which will make their life easier, which will make their caring more easy.’
Kirsty Allsopp reckons that stamp duty puts pensioners off downsizing ahead of final move
Capital punishment: London buyers pay 47 times more stamp duty for an average home than those in the East Midlands
Homebuyers in London typically pay 47 times more stamp duty than those in the East Midlands, according to Coventry Building Society.
An average home in the capital is worth £543,099, meaning a buyer pays £14,654 in land tax.
But those buying in the East Midlands pay £307 on a typical home worth £256,206.
Jonathan Stinton, from Coventry BS, says: ‘A system where people can pay up to 47 times more tax than others — on something which is only twice as valuable — is clearly flawed.’
The differences are due to rises in stamp duty tax thresholds last September.
Homebuyers previously paid the duty on properties worth more than £125,000 — but changes mean the first £250,000 is now tax-free.
The next £675,000 is taxed at 5 per cent, up to a value of £925,001, after which point it increases to 10 per cent.
The thresholds are in place until March 2025 and reduce the amount of stamp duty on an average-priced home from £5,767 to £3,303.
Government legislation states you must pay Stamp Duty Land Tax (SDLT) if you buy a property or land over a certain price in England and Northern Ireland.
Currently, the threshold applies to all residential properties valued at £250,000 or more.
The latest figures revealed the Treasury pocketed an extra 69 cent between financial year 2020 to 2021 and 2021 to 2022, from £6 billion to more than £10 billion.
Of these transactions, 52 per cent were accounted for by properties valued at £250,000 or less – with only three per cent coming from properties valued at over £1 million.
Allsopp – who has homes in Notting Hill, west London and Devon – caused uproar last year when she suggested young people stop wasting money on Netflix and coffee and move somewhere cheaper to get on the property ladder.
On the podcast she said she had been misquoted and described the backlash as the ‘most devastating time of my life’.
Speaking about the current housing market crisis now, she continued: ‘Our planning and zoning is shot to pieces.
‘The transactional process is not fit for process and is collapsing.
‘The rental market is completely up the creek without the paddle.
‘We need to have longer, more secure leases and stop having this incredibly combative attitude between landlords bad, tenants good.
‘You just don’t have that in Germany and Italy and other places.
‘You need secure long tenure, to be able to plan for your children.
‘We spend – as a proportion of our income – it’s mad.
‘The two things in this country which are so cripplingly expensive are property and childcare.’
Source: Read Full Article
