Simone and Jim Steele love their four-bedroom bungalow where they have lived for 40 years.
Their backyard, a third of an acre of manicured beauty, is the talk of the street and overlooks the picturesque Preseli Hills.
“I never get bored of the views from our garden,” says Simone, 69, a retired council land rights officer.
“The light sometimes changes hourly, giving me an ever-changing perspective on the world beyond our four walls.”
But the Steeles, who live on the outskirts of Haverfordwest in Pembrokeshire, are becoming increasingly frustrated.
Now that Jim, 75, is in poor health, they are interested in moving to a smaller property with a more manageable garden.
Trapped: Jim and Simone Steele want stamp duty scrapped so they can downsize from their current property on the outskirts of Haverfordwest in Pembrokeshire.
However, they simply cannot afford it, and one of the biggest impediments is stamp duty.
Downsizing to a property they like would result in a hefty stamp duty bill, plus estate agent fees, solicitor fees and moving costs.
“I’m sure that if stamp duty were abolished,” says Simone, “more people our age would downsize, freeing up larger properties for younger generations to buy.”
She says many homeowners on the street they live on are in a similar situation: keen to move to a smaller property, but unable to do so because of stamp duty.
Like the Steeles, hundreds of readers have contacted Money Mail in the last seven days, supporting the campaign we launched to get Chancellor Jeremy Hunt to reduce stamp duty (or, better still, abolish it) in next month’s budget.
Almost everyone believes – as we do – that its elimination would help free up a stagnant real estate market.
It would allow people to move up the property ladder more easily during their working and family lives, and then move back in retirement as they downsize.
The benefits would go far beyond the real estate market. It would increase labor mobility, allowing people to move from one end of the country to the other in search of better job opportunities.
It would also be an economic boost, as people would spend money remodeling their new homes.
Our campaign has already received political support.
Workload: The Steeles, who live on the outskirts of Haverfordwest in Pembrokeshire, are looking to downsize to a property with a more manageable garden than their current home (pictured).
Writing in The Mail on Sunday three days ago, former Housing Secretary Robert Jenrick called on the Government to “cut one of the most counterproductive and anti-growth taxes”.
He added: “(Stamp duty) traps people in homes they want to move out of and makes older people reluctant to downsize, which in turn leaves younger families in smaller homes.” .
Unlike other tax cuts, a lower stamp duty would “create an immediate feel-good factor”, he said.
Michael Gove, Jenrick’s successor as housing secretary, is also interested in a stamp duty cut. Last weekend, Gove said he was constantly pressing the Chancellor to introduce measures to make housing more affordable.
As well as a stamp duty cut, Gove wants Hunt to help first-time buyers by introducing 99 per cent state-backed mortgages.
For removal companies, stamp duty is currently charged on a sliding scale and the first £250,000 of a property’s purchase price is tax-free.
Thereafter, the rate jumps abruptly, from 5 per cent on the value of £250,001 to £925,000; 10 per cent from £925,001 to £1.5 million; and 12 percent on any surplus.
Therefore, someone moving into a house costing £500,000 must pay stamp duty of £12,500, although from April 2025 this would rise to £18,750 if the nil rate band fell to £125,000 as the Government.
Like the Steeles, Clare Lake and her partner Allan are keen to downsize. They live on the outskirts of Falmouth, Cornwall, in a five-bedroom house they used to run as a B&B.
For removal companies, stamp duty is currently charged on a sliding scale and the first £250,000 of a property’s purchase price is tax free.
But with Clare turning 69 on Friday and Allan celebrating his 70th next week, the house is now beyond their means and they are keen to move closer to Clare’s brother and son in Southampton and Lymington respectively.
“Allan is not in good health,” says Clare, “and sometimes the stairs are a struggle for him.” Additionally, public transport in Cornwall is not working very well and our Barclays bank in Falmouth has closed.’
Clare, a textile designer, says: “We have no desire to move into a shoebox, but even if we could find a three-bedroom bungalow, we have calculated we would be parting with around £50,000 in moving costs.” , a large part of which would be stamp duty. Surely it is time for the Government to review this most unfair of taxes?
Clare says the Government should do more to encourage older people to reduce their spending.
She explains: “Perhaps, once homeowners reach state pension age, the Government could reduce the yoke of stamp duty for them, as it does for first-time buyers.”
Currently, first-time buyers can purchase a property worth up to £425,000 and pay no stamp duty. Above this value, the rate is 5 per cent up to £625,000; Properties worth more do not qualify for relief.
A similarly large tax-free band, or lower stamp duty rate, for downsizing pensioners, Clare says, would be a game-changer.
“It would change the math of moving right away,” he says, “and free up the housing market.”
Barbara Bass, a 70-year-old retired pharmacist from Redbridge, Essex, believes stamp duty should be abolished. “It’s a horrible tax,” she says.
“You work your way up the housing ladder, and the government rewards you by taxing you every time you move. I don’t see any justification for it. It’s like throwing money down the drain.
Barbara says her son David is desperate to move to a bigger house in Epping, Essex. He and his wife have two children, ages two and three, and although they live in a three-bedroom house, it is difficult to isolate it; the garden is tiny; and overlooks the London Underground.
But they have been frustrated by the onerous costs of stamp duty. Barbara says: “In David’s case, he is now trapped in a house unsuitable for the needs of his family.”
Research by Coventry Building Society shows that many homebuyers are turning to their home deposit to pay stamp duty.
Jonathan Stinton, head of mortgage relations, says it adds “to the long list of reasons why stamp duty should be one of the Chancellor’s top priorities next month in the Budget”. We agree.
jeff.prestridge@dailymail.co.uk
I’m avoiding a £22,000 tax by building a shed instead
By LEE BOYCE
Home Improvement: Lee Boyce
Eight years ago, my wife Danielle and I bought our first home in Rayleigh, Essex. A small but functional three-bedroom semi-detached house that has served us well.
However, as our family was about to go from three to four with the arrival of baby number two in April, we decided to move.
In the spotlight: a single-family home with four bedrooms and a laundry room. The inconvenient? We are looking at an unaffordable price of at least £700,000.
The main sticking point is that, on top of this huge sum, we would have to fork out stamp duty, an obstacle that I believe is blocking many potential second movers like us. We have accumulated a good amount of capital, save diligently, and have two decent salaries. But shelling out £22,500 on a monstrous stamp duty bill makes what could be a step up the ladder a giant leap.
So to avoid stamp duty, along with potentially higher mortgage rates, we have chosen to stay put. To improve, not to move. Our new son will inherit the third bedroom, the storage room, which we now use as an office.
An office shed will be built at the back of the garden on an existing patio at the end of the month. At 10ft x 9ft it’s a great size and costs £11,000.
The price includes full insulation, plus wiring for electricity, broadband and lighting by an electrician. At half the cost of stamp duty, I would prefer our outlay to be converted into a tangible asset.
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