Dr James, 0s:

Well, we said we would catch up again after the budget was announced, Sarah, and, true to form, we're here to talk about, well, what's been happening over the last few weeks with regards to the budget, with regards to mortgages and property, and also, specifically, with regards to dentists, and we did a podcast very recently on this, which we're going to touch upon as well yes, yes.

Sarah, 23s:

So probably the biggest thing in in my world and the dentist's world that's going to affect them is uh, stamp duty, uh so so as, as we discussed in our last podcast, you know, it was like, well, we don't know what's going to happen next week and all of that where we know what's happened and basically they've not been kind to first-time buyers. Um, it's going to be from the 1st of April next year. There is not going to be any incentives whatsoever for first-time buyers. So stamp duty being the biggest thing, uh, which is going to affect first-time buyers, so stamp duty being the biggest thing which is going to affect first-time buyers. There's two things on the stamp duty. One, they're removing the first-time buyers stamp duty relief and the other thing, which affects everybody, is that they're reducing the nil rate band from 250 to 125,000. So, yeah, first time buyer. So to put these numbers into sort of reality, if you're purchasing a property for 500k which I would say is probably our average sort of first-time buyer type property purchase price, up until and including the 31st of March, that would cost three thousand seven hundred and fifty pounds. From the 1st of April, it's going to cost £10,000. So a massive £6,250 increase.

Dr James, 2m 12s:

And that's for first-time buyers right, First-time buyers.

Sarah, 2m 16s:

So, given the same example for a mover, so this is somebody that's selling their current home and buying a new one, so that they will only ever that they're selling their residential and they're buying a new residential At 500,000. Up until the 31st and including the 31st of March, that will cost 12 and a half thousand. From the 1st of April that will cost 15,000. So it's it's going to affect them by two and a half k, but not as much as the first time buyers I see. So, really, if we're 50 50 making a decision whenever it comes to buying a house, maybe from that perspective we want to think about it sooner rather than later yeah, now our average sort of timescales for a purchase is four months because you know it's typically there's not two people in the chain, ie there's a buyer and a seller, because normally that seller is buying something else and that seller might be buying something else. So typically there's three or four people in the chain and you're only as quick as the slowest person. So I would suggest that if you're purchasing, you make it a condition of your purchase that you you complete by the 31st of march oh, that's possible you can do otherwise. Otherwise, you know, you walk away or you want a reduction in your purchase price, like you know, uh, nothing, nothing is guaranteed until you exchange contracts, which typically is is a couple of weeks before you actually complete. So you, you can't really. Uh, you know, there's no, there's no real sort of ways you can pin people down. But if you're very clear from the beginning, at least everybody knows. So if you pull out or if you want to renegotiate the price from the first of april, you know they're not going to be in any have any surprises, because you've told them right from day one and what about, aside from people who are making residential purposes for residential purchases?

Dr James, 4m 40s:

beg pardon, is there any other changes?

Sarah, 4m 43s:

yes, so buy to let, so buy to let has had a horrible sting in the tail as well. So you used to have to pay normal stamp duty plus 3%, but that went up from last week there's no grace period with Vitalet and that went up to an additional 5%. So to give you an example, although the nil rate band with that changing from 250 to 125, that still does have an impact. So there is still an incentive to complete by the 31st of March. But on a 500K purchase by Tillette you're going to be paying wait for it $337,500 stamp duty and then from the 1st of April that's going to cost you $2,500 more at 40K.

Dr James, 5m 47s:

So wait, if I've understood this correctly, there's some changes they've brought in with immediate effect. Yes, and some further changes that are going to be coming in the new tax year.

Sarah, 5m 58s:

Yeah, basically the nil rate band is coming in from the first time buyer, which Liz trusts. She introduced that two years ago up until the 1st of April 2025, and Labour haven't changed that, so it's going to revert back to how it was.

Dr James, 6m 20s:

So they're really trying to pour some cold water on the housing market. Do you think that's fair to say?

Sarah, 6m 27s:

Yeah, but you know, I think that possibly, with interest rates, they're going to improve over the next couple of years, I would have thought, compared to what they've been over the last two years. So you know, how long can people hold off waiting to buy? You know people want to buy homes, don't they? And so it's probably just a good opportunity to make some money there we are get some money in.

Dr James, 6m 59s:

Uh, yeah there we are. So would you say those are the biggies in terms of changes from the budget. Anything else need to be aware of?

Sarah, 7m 6s:

well, I'm sure all the accountants have sort of covered all of the business reliefs and uh and and that sort of thing. But really from a mortgage home ownership know, obviously there's changes in capital gains tax, property relief and all that sort of thing. But I'm sure your accountants have covered that in their talks. But yeah, there is, stamp duty on purchases is the main thing that affects me and what I do for clients we are and yes, you are absolutely right, we have released and we were releasing content.

Dr James, 7m 48s:

We'll be releasing. We will be releasing further content on capital gain stacks long story short. Long story short. It's going up, it's going up yes, if you make money, you're going to have to uh pay more tax well, I think it has gone up is a more accurate statement because they brought it in with immediate effect from november, the first. I'm pretty sure the capital gains did they. I'm pretty sure they did. I'm gonna have to look that one up.

Sarah, 8m 14s:

You know I'm not, I'm not 100 sure. I know the business relay reliefs and that that's going to be April, isn't it?

Dr James, 8m 22s:

Yeah, I know that part. But yeah, I'm going to have to look the capital gains one up, whether that was immediate effect or whether that was a little further down the line, Because the problem is that with, specifically that one, the assets are way more liquid, so there's more of an opportunity to game the system. I'm going gonna have to look that one up. Well, we're gonna. We'll probably have released a podcast, but the time just comes out on that. So, yeah, whatever that podcast is, revert back to that one. In fact, I'm going to shout those out just now. One is with johnny minford and one is with david hawson. We haven't got titles for them just yet. The day that we're recording, which is the 5th of november, that is, today. But if you guys have a little search around on the dentist invest podcast, you'll be able to find, very close to this episode, those two podcasts. They'll be worth listening to because we're going to cover every other aspect outside of property on those podcasts and how they've changed with regards to the budget yeah great vinder bar. What about if we're talking to the dentist specifically? Sarah got any specific words of wisdom? Or maybe we've covered everything today?

Sarah, 9m 19s:

well, you know first-time buyers. So let let's say you're an associate that started your self-employed position in September. So a lot, of, a lot of dentists are under the misconception that you need to have one year's accounts at least, or some even think that you need to have two years. We can get a mortgage with just three pay schedules. So if you've got your September, your October and as of today we're the 5th of November, recording at the end of November, you will have three pay schedules so we can average your earnings that you've had go into your bank account for the last three months. Let's say that you've been doing an average of 7K a month, which will be 21,000 over the three months. We can use your income as £84,000 and potentially get you to be able to borrow a £420,000, dependent on affordability commitments and that sort of thing. But you know it is possible. So, yeah, if you're a new associate or you've had a big change, you've gone from employed to self-employed and you don't have the trading years that you think you need, we can get you in and hopefully have your mortgage complete before the 31st of March so that you can benefit from those statutory savings.