Although the planned VAT rise is an unwelcomed additional cost to the price of both buying and selling a property, Douglas Sleaper, group sales director for Townends Estate Agents, believes the 2.5% increase will not be significant enough to unduly upset the housing market or deter those wishing to move from doing so.
Douglas commented, “Admittedly, the planned VAT rise comes at a particularly bad time for would-be buyers who are already struggling to save enough money to buy a new property. However, in the grand scheme of things, the 2.5% increase on the average associated moving costs such as surveying, conveyancing and arrangement fees will amount to an approximate £50 total increase - a mere ‘drop in the ocean’ when buyers’ first priority is finding a deposit large enough to secure a mortgage which will offer affordable repayments.
“Moving house is usually a planned decision and this increase is certainly not substantial enough to dissuade those wishing to purchase a property from doing so. In fact, contrary to deterring house buyers from making a purchase, once again there are more and more professional investors in the market, taking the place of first-time buyers, looking for value for money and enhanced yields as they see steady and strong rental demand for the foreseeable future. It is these investors and landlords who may wish to renovate a property on purchase that will bear any brunt of the VAT rise.”
