"The measures are a proportionate response to the effect of the pandemic in Wales. Pressure will now be on the UK government to pass similar measures."
The changes include a 1% increase in the surcharge for purchases of second homes, from 3% to 4%, rising to 16% for homes worth over £1.6m. The surcharge is currently 3% in England and Northern Ireland and is already 4% in Scotland.
The extra revenue produced by the higher surcharge, estimated at £13 million, will be invested in social housing.
There will also be a 50% increase in the nil-rate band for non-residential (or mixed) transactions from £0-£150,000 to £0-£225,000. This change is designed to help businesses recover from the Covid-19 pandemic.
The Welsh government also announced that the stamp duty holiday will not be extended in Wales. It will end, as planned, for completions on or after 1 April 2021.
Sean Randall, a partner at Blick Rothenberg, said: “The measures are a proportionate response to the effect of the pandemic in Wales. Pressure will now be on the UK government to pass similar measures."
Richard Pike, sales and marketing director at Phoebus Software, commented: “The news from the draft Welsh budget today will no doubt have the market looking to the UK government for an idea on what may happen when the SDLT holiday period finishes.
“There are two questions that need to be answered. Firstly, what happens to any mortgages that are in the pipeline on 31st March? Secondly, with the country still paying the price of Covid-19 and the uncertainty that it has caused to personal finances, can the government actually afford to go ahead with the deadline? There is an argument that asks whether, while the market is moving and putting back into the economy, can they take the risk that end of the holiday won’t put the brakes on again?
“The murmurings are that there will be no extension, but perhaps an increase in second home surcharges and an increase for high value properties may be the better option?”
