Would you be offended if someone offered under asking price?

claire16c

I live in Berks and my friend just bought a house for £224k which was on at £250k.

The only reason why I can see someone paying that much to live where Tancred does is for the proximity to the train station.

I live in a slightly more expensive area than Reading and near me there are 3 beds with downstairs cloak rooms for £250k so Im not sure why someone would pay more for a house with only one bathroom. Apart from the train station thing perhaps.

Tancred

ukcarper wrote: »

I don't know what that would cost the government but it makes sense to me and it is the way income tax works.

Indeed. When you go into the 40% band you don't pay income tax at 40% on all your income - this would be madness. Imagine that - you would have to turn down pay rises to avoid the 40% rate!

Tancred

claire16c wrote: »

I live in Berks and my friend just bought a house for £224k which was on at £250k.

The only reason why I can see someone paying that much to live where Tancred does is for the proximity to the train station.

I live in a slightly more expensive area than Reading and near me there are 3 beds with downstairs cloak rooms for £250k so Im not sure why someone would pay more for a house with only one bathroom. Apart from the train station thing perhaps.

Not just the station. There is a short distance to the town centre, you are a few yards from the river and there are numerous shops and restaurants only minutes away by foot or by car. In brief, it's a perfect location and convenient for just about anything. That's why I bought it in the first place.

Yes, you can find loads of 3 bed terraces around Reading for under £250k but in the immediate area near me (quarter mile radius) I've seen only two similar properties at £250k and both have smaller bedrooms and tiny gardens. Also, neither are in such a prime location very near the river.

Also, don't forget the being able to walk to the station is very important if you are a commuter. Given the huge cost of parking at the station you can save thousands in the long run.

DRP

Tancred wrote: »

Indeed. When you go into the 40% band you don't pay income tax at 40% on all your income - this would be madness. Imagine that - you would have to turn down pay rises to avoid the 40% rate!

The logic must be that stamp duty at the higher rate would only target 'wealthier' buyers. ie. those that can afford to pay 250+ can well afford to pay it!

The current system helps those less able to afford to buy - if stamp duty were 'fairer' (like income tax), in order to raise the same revenue the govt would have to charge sub-250 purchasers more than 1% i would imagine... which would depress the market at the lower end?

undetterred

The biggest problem is delusional buyers,offering on houses that they realistically cant afford.

martinsurrey

DRP wrote: »

The logic must be that stamp duty at the higher rate would only target 'wealthier' buyers. ie. those that can afford to pay 250+ can well afford to pay it!

The current system helps those less able to afford to buy - if stamp duty were 'fairer' (like income tax), in order to raise the same revenue the govt would have to charge sub-250 purchasers more than 1% i would imagine... which would depress the market at the lower end?

If they made it more like income tax and KEPT the overall tax take the same, houses just below the current thresholds would be hit hard, so say £5-6k at £249,999 (against £2.5k now) while properties just above would be relatively better off (again £5-6k against £7.5K now).

So everyone currently aiming to buy a house at £250k would be furious, people selling a house just above would be delighted.

it would be a much fairer system in my opinion and no harder to administer, but there seems to be no political will to change it.

sunshinetours

It would kill the FTB market pretty much overnight in the SE which is why there is no will to change to that sort of system i.e increasing properties below £250k

As said many pages ago it distorts the market around the £250k mark hugely which is why you don't often see any where near as many properties marketed or even moreso, actually selling, around £260k unless they have incentives as mentioned above

Tancred

DRP wrote: »

The logic must be that stamp duty at the higher rate would only target 'wealthier' buyers. ie. those that can afford to pay 250+ can well afford to pay it!

The current system helps those less able to afford to buy - if stamp duty were 'fairer' (like income tax), in order to raise the same revenue the govt would have to charge sub-250 purchasers more than 1% i would imagine... which would depress the market at the lower end?

Nonsense. The current system is utterly idiotic because you pay 3% on £250,001 and 1% on £250,000 - what's the logic of this? The jump from 1% to 3% is huge, and your claim that 'wealthier' buyers can afford to pay the 3% is very wrong - many people who buy at the £300k end are not at all wealthy but ordinary people who do normal 9 to 5 jobs and have big mortgages. I would prefer a flat rate 2% stamp duty on all properties under £500k. The current jump between 1% and 3% only distorts the market.

Tancred

martinsurrey wrote: »

If they made it more like income tax and KEPT the overall tax take the same, houses just below the current thresholds would be hit hard, so say £5-6k at £249,999 (against £2.5k now) while properties just above would be relatively better off (again £5-6k against £7.5K now).

So everyone currently aiming to buy a house at £250k would be furious, people selling a house just above would be delighted.

it would be a much fairer system in my opinion and no harder to administer, but there seems to be no political will to change it.

The problem is that when the 3% threshold was introduced you could buy a large house with £250k, but not now. The thresholds have not been upgraded with standard inflation, let alone house price inflation.

Tancred

sunshinetours wrote: »

It would kill the FTB market pretty much overnight in the SE which is why there is no will to change to that sort of system i.e increasing properties below £250k

As said many pages ago it distorts the market around the £250k mark hugely which is why you don't often see any where near as many properties marketed or even moreso, actually selling, around £260k unless they have incentives as mentioned above

I don't think a flat 2% rate would 'kill' anything. The bottom line is: if you if can't afford it, don't buy it.