The Times reported on 20 July 2010 that the government are considering imposing a stamp duty penalty on people buying properties which are found to be ‘energy inefficient’ after obtaining an Energy Performance Certificate (EPC). A rebate for stamp duty can be applied for once the property has been improved and made more energy efficient. Click here to read the full report.
At present, an EPC is needed for all properties which are placed on the market (this is despite the HIPs packs being abolished by the new government) and the EPC must be produced within 28 days of the property being marketed. The EPC rates the property from A to G as to how energy efficient it is and it will recommend measures that can be undertaken to improve its rating.
Stamp duty is already excessive, to say the least, especially for those buying properties worth over £250, 000 (as the rate leaps from 1% to 3%). It seems extremely unfair that buyers are to be further penalised just because they are buying a property which is considered to be ‘energy inefficient’. It will deter people from buying such properties since they may not wish to pay the extra tax. It also means sellers may be forced to incur additional costs to get the property upgraded to a higher rating in order for them to achieve the best possible price for the property or to find willing buyers.
With the conveyancing market as unstable as it is this is definitely not something that is going to do home buyers and sellers any favours. We simply cannot afford to have any more changes introduced in the current climate which will destabilise the property market any further.