Autumn Budget: effect on the housing market in Northern Ireland

Posted on 30 November 2017

Autumn Budget: effect on the housing market in Northern Ireland

When the Chancellor announced in the Autumn budget that stamp duty would be scrapped for first time buyers up to a value of £300,000 it caused quite a stir.


Now that the dust has settled I have started to wonder how much of an effect this will actually have, particularly here in Northern Ireland.


First time buyers in Northern Ireland are unlikely to be paying much more than £125,000 for a property, and could purchase a nice first home for that kind of money.


This means that the majority of first time buyers here are no better off as they would not be have been paying stamp duty on purchases below £125,000 before these new rules came into effect.


If a first time buyer could stretch to £150,000 they would be saving £500 which is a nice reduction, but hardly game changing.


I accept that this will have a larger impact in more expensive parts of the country where first time buyers can and do spend more. 


At the top end of the allowance where a property is purchased for £300,000 a first time buyer will be £5000 better off than someone who is trading up and, crucially, a whopping £14,000 better off than someone buying an additional property.


It is this disparity between first time buyers and those buying an investment property or a second home that will have the biggest impact, which presumably was the government’s intention.


Even at Northern Ireland prices, there is still a marked difference in what the two parties would pay in stamp duty. For our £150,000 property the first time buyer will pay £500, but the investor would pay £5000.


Even at the lower end of the scale, it is another incremental tilt of the playing field away from investors who some might argue are already being hit too hard.


The danger in all of this is, as always, that any potential savings in stamp duty will translate directly into higher house prices. As a result of stamp duty savings, first time buyers can now afford to pay a little bit more for their chosen property, so that saving simply results in an offer that is higher by the amount they’ve saved. 


Obviously the intention was not to contribute to a rise in house prices, but that is ultimately what may well end up happening. 


For more information about the market in Northern Ireland, please feel free to contact Steve or Seamus at info@mcguinnessfleck, or visit our website to see the properties we have for sale/have recently sold at