While campaigning for prime minister Boris Johnson may make radical changes to Stamp Duty cutting the cost to homeowners.

Boris Johnson campaigning to be prime minister has announced radical changes to Stamp Duty including switching the burden from buyer to seller and raising the threshold from £125,000 to £500,000.

With a higher threshold an additional 300,000 properties would be free of stamp duty adding to some 400,000 already below current threshold levels.

Switching the burden from buyers to sellers would be good news for first time buyers as they would save money on stamp duty which they can add to their deposit to get a foot on the property ladder.

For home movers selling a property below the £500,000 threshold to one above the threshold would appear to free them from paying stamp duty make upsizing more affordable.

Switching stamp duty to sellers

The proposal from Boris Johnson would see stamp duty switched from the buyer to the seller which means no stamp duty tax to be paid by first time buyers.

Currently first time buyers pay no stamp duty land tax (SDLT) on a threshold up to £300,000 for properties valued up to £500,000.

For residential homeowners such as home movers and buy-to-let investors stamp duty is a percentage of property price as follows.

Property Values	Standard Rates	Buy-to-Let Rates
Up to £125,000	0%	3%
£125,000 - £250,000	2%	5%
£250,000 - £925,000	5%	8%
£925,000 - £1.5m	10%	13%
over £1.5m	12%	15%

Stamp duty for residential properties is paid on the proportion of £125,001 and over and buy-to-let investors or those buying a second home pay an additional 3% on the whole property value.

The proposed change would help home movers upsize to a larger property as they pay stamp duty on the home they are selling and nothing on the new more expensive home they are buying.

Mr Johnson also proposes to reduce the top rate of tax applying to homes valued at £1.5 million or more from the current 12% to only 7%, although the additional 3% tax buy-to-let investors pay was not mentioned.

Increase cost of downsizing your home

For homeowners in a large property wanting to downsize to a smaller home, they would pay more stamp duty tax as they would be moving from a more-expensive property to a cheaper property.

This would be unpopular as homeowners may have already paid stamp duty to buy their homes and are now expected to pay stamp duty again to sell their home.

Even so, home movers downsizing tend to be older selling large family houses to buy a smaller property and more likely to have a small or no mortgage with greater resources to pay the stamp duty.

Older equity release buyers can stay in your own home rather than downsize avoiding the expense of stamp duty by accessing the property wealth with a lifetime mortgage to maintain your lifestyle, holidays or home improvements.

The stamp duty changes may mean a larger number of remortgage buyers staying in their existing home rather than trade up or downsizing and this may reduce the supply of suitable properties on the market.

What are your next steps?

Call our LCM mortgage brokers for advice if you are a first time buyer, want to remortgage your existing home for the best mortgage deal, moving home or a buy-to-let investor.

For equity release buyers our London City Mortgage advisers can recommend lifetime mortgages allowing you to receive cash from your property to repay an interest only mortgage or buy a more expensive home.

Start with a free mortgage quote or call us and we can take your details. Learn more by using the property value tracker chart, mortgage costs calculator and equity release mortgage calculator.