Confirmation that second home sales in Wales will not be exempt from tax welcomed by Gwynedd politicians
Politicians in Gwynedd have welcomed confirmation that a slashing of the land transaction tax in Wales will not apply to second or buy to let homes.
Changes, revealed on Monday, mean that around 80% of house sales will be exempt from paying tax until the end of March.
Responding to the UK Government’s decision to waive stamp duty on properties up to £500,000 in value, in Wales (where its known as the Land transaction tax) the “holiday” will only apply for homes sold for between £180,000 and £250,000.
It is already the case that no such tax is paid on transactions below that figure, with the maximum tax currently payable on a £250,000 property being £2,450.
But community leaders in the Welsh county that contains more holiday homes than any other – thought to be over 5,000 – have welcomed a decision to exempt such properties from the tax exemption.
Such buyers will also have to continue paying the additional 3% in tax on top of the existing rate for their value.
Finance minister Rebecca Evans, making the announcement on Monday, said: “Unlike in England, this new threshold will not apply to the purchase of additional properties such as buy-to-lets or second homes.
“It will support people looking to purchase their first home or those seeking to move up the property ladder.
“So it will offer more targeted help to those who may be affected by the economic challenges resulting from the pandemic.”
In Gwynedd the local authority has been particularly outspoken in its concerns over the number of second homes in the county.
In May it urged the Welsh Government to give them the necessary tools to solve the county’s “housing crisis”.
Around 40% of houses currently sold in the county are either holiday homes or “buy to lets,” highlighting long-standing complaints that house prices in parts of north west Wales are well beyond the reach of most locals.
But with some 10% of Gwynedd’s housing stock currently used as second homes, cabinet members have reiterated the need for outside help in tackling the “hidden homelessness” present in the region.
Today the council leader, Cllr Dyfrig Siencyn, said: “I welcome the Finance Minister’s statement that the holiday from paying land transaction tax of up to £250,000 will not apply to second home purchases or buy to let properties.
“This ensures that buyers who have the means to purchase a second property do not benefit from the announced tax breaks that supports the housing market for first time buyers and those in need of a home.
“Again, let’s make it clear that Wales is following its own unique path, to benefit the people of Wales.
“It is evident that we should have more decision-making powers in a wide range of areas, in order to create a prosperous Wales.
“Such decisions should be taken by our government here in Wales and not by the reckless and disinterested politicians of Westminster.”
Arfon Senedd Member Sian Gwenllian, added, “Without this caveat, it would have disproportionately helped second home and buy to let buyers.
“In too many communities, local people can’t buy their first home because the presence of too many second homes has pushed house prices out of the reach of local families.”
Ms Evans, during her announcement on Monday, confirmed that the decision to cut the amount of tax paid by house buyers was “very much a response” to the chancellor’s changes revealed, saying the “porous” nature of the Welsh-English border was also a motivating factor.
By Gareth Williams – Local Democracy Reporter
Spotted something? Got a story? Send a Facebook Message | A direct message on Twitter | Email firstname.lastname@example.org