Effective from June 30, changes to the LBTT Scotland Act 2013 introduced tax relief for first-time buyers acquiring ownership of a property, if certain conditions are met.
The change has raised the zero-tax threshold for first-time buyers from £145,000 to £175,000.
Additionally, first-time buyers purchasing a property above £175,000 will qualify for relief on the portion of the price below the same threshold. This means that all first-time buyers who meet the qualifying conditions will benefit from relief of up to £600.
Claire Flynn, PR and content executive at ESPC, said: “This is a highly positive change to the LBTT Act and an encouraging sign to would-be homeowners. The present market conditions are particularly difficult for first-time buyers and any measure introduced to help people in their journey towards owning a home is a welcome one.
“In addition, this change highlights that there is room to review and improve the LBTT Act as it currently stands. At ESPC, we are open to engaging in discussion with the government about the Act and improvements that can be made to allow the Scottish housing market to flourish.”
Jenna Spence, operations director at Neilsons Solicitors and Estate Agents, said: “The introduction of tax relief for first-time buyers up to a purchase price of £175,000 is welcome news.
“The current market in Edinburgh is challenging for buyers across the board but particularly challenging for first time buyers because the valuation sets a ceiling on the loan to value ratio of the borrowing, i.e. you can only borrow up to 95% of Home Report valuation and anything you offer over has to come in 100% from your own resources.
“In east central Scotland, it has been a seller’s market in recent years – there has been a shortage in properties coming to the market and so demand has outstripped supply. The effect on the market is that closing dates are a key feature where all interested parties submit their best offer in a blind bidding process and the result is that properties are regularly selling for above valuation.
“When the market is hot, first time buyers need as much money as possible to put towards the purchase price and anything which assists in this connection is to be welcomed.”