Offering to pay stamp duty

Tiggergirl

Our house has been on the market for around 7 weeks, at what I think is quite a competitive price. We’ve had some interest, with feedback saying that it has a lot of space for the price but ultimately no offers. One viewer said it didn’t feel homely enough, which is probably down to the fact that we’ve moved out so it has no furniture in, and we have redecorated in neutral colours to provide a blank canvas to buyers.

To get to the point, we have already relocated for family and work reasons and are renting in another part of the country, so we are serious about selling and with paying mortgage and rent would rather sell sooner rather than later.

One of the main issues where we are selling is that there is a glut of brand new houses on the market in the area. Over half the 4 bed detached houses for sale within half a mile are brand new, though a lot more expensive than ours for the space. Ours is one of the lowest priced second hand ones. Ours is on at £209,950 and the two that are cheaper are on at offers over 180k and OIRO 200k – both are smaller than ours which has 4 double bedrooms.

I don’t want to reduce the price just yet but am planning forward if we don’t get a bite in the next few weeks. Given that there is a lot of competition locally with builders offering buyer incentives, do you think there is any mileage in us offering to pay a buyer’s stamp duty now that the FTB stamp duty holiday is over? Our house is only a few years old and could therefore potentially be of interest to anyone looking at the brand new houses locally but who want a bit more for their money. Also what is the general opinion on lowering the price but listing at ‘offers over’?

Yorkie1

You'd need to check this out, but I believe you will have difficulties with what you propose.

Essentially it amounts to a gifted deposit from the seller, which would have to be declared to HMRC / lender.

There aren't any lenders on the market (I think) who will accept a private vendor gifted deposit as part of the transaction (builders are different).

choppy34

When we sold we offered an incentive of £600 towards legal fees/ redecoration. There wasn't a problem with this with the buyers lender Halifax nor with the solicitors!

Tiggergirl

Yorkie1 wrote: »

Essentially it amounts to a gifted deposit from the seller, which would have to be declared to HMRC / lender.

There aren't any lenders on the market (I think) who will accept a private vendor gifted deposit as part of the transaction (builders are different).

So would this mean that the lender would value the property at offer price less the stamp duty contribution?

Even though essentially the total cost to the buyer would be the same, presumably there is still a cash flow advantage to a buyer since it's a couple of grand less to save up for buying costs?

[Deleted User]

To me when I see these incentives on rightmove, I think they just gimmicks & would prefer the cash off the asking price. May attract some but it would make no difference to me.

brit1234

When I see "We'll pay the stamp duty" on Rightmove I think desperate seller and property bee usually confirms it.

As others will surely say most buyers don't care if you will pay the stamp duty, they would just rather have a lower price instead.

CANIGOHOMEYET

I work in sales for a house builder, and we pay the deposit to help our buyers with cash flow.
It mainly helps first time buyers who have saved hard for their deposit and still need to buy furniture etc. Reducing the property by the same amount would not help them much as they would still need to find stamp duty on the final price.

However, a four bed house is hardly a first time buyer property and most people with a decent deposit are deal driven. You could think about hiring some furniture and dressing out your house. Thats what we do when we've got when a property is sticking. Works every time.

Good luck with your sale

Tiggergirl

CANIGOHOMEYET wrote: »

You could think about hiring some furniture and dressing out your house. Thats what we do when we've got when a property is sticking. Works every time.

At the moment we aren't paying any council tax on the property as it's empty. Once the six months is up we may think about it.

DVardysShadow

brit1234 wrote: »

When I see "We'll pay the stamp duty" on Rightmove I think desperate seller and property bee usually confirms it.

As others will surely say most buyers don't care if you will pay the stamp duty, they would just rather have a lower price instead.

Broadly I agree with this - although I would not be quite so broad brush about 'desperate'. As buyer, I would see a seller who did not wish to drop the advertised asking price but who would be prepared to negotiate.

I would still structure the deal to pay my own stamp duty

bmar71n

offering to pay the stamp duty is the same as lowering the price, so you may as well just lower the price as this is more likely to attract more potential purchasers as the asking price is the first thing they notice.

Nenen

I disagree with the pps who say just lower the price, as some buyers want to have as much of their savings as possible for the deposit so that they can get a mortgage. As an example, using simple figures,

Buyer has 20k + enough money for legal fees, house costs 198k Stamp duty would be £1,980 leaving buyer with £18,020 as deposit (less than 10% so hard to find a mortgage at a good rate of interest, if at all) and a mortgage of £20 under 180k

However, house costs 200k and seller gifts stamp duty of 2k. Buyer puts down 10% deposit of 20k and has 180k mortgage.

In both cases seller has got 198k for the house!

I would certainly look favourably at a seller offering to pay stamp duty, especially when asking price is not that much over the threshold.

Regarding marketing at 'offers over'.... Personally I hate that and it puts me off viewing. I prefer a straightforward asking price, which I expect to negotiate on, or 'offers around'.

Good luck with your sale.