There are a number of developments in Jersey where the properties can only be owned by "first time buyers". This term includes both true first time buyers and those who fall within the exemptions below.
You may be able to buy a property within a first time buyer development despite already having owned a property:
- If you already own a share transfer flat you may be able to buy a property in a first time buyer development if you (1) sell your flat to anyone, not necessarily a first time buyer, and (2) buy a property larger than your current home i.e. moving from a two bedroom flat to a three bedroom house;
- If you have bought a flying freehold flat you may be able to buy a freehold property in a first time buyer development, provided you sell your flying freehold flat to a first time buyer and buy a property larger than your current home;
- If you have previously owned land before, but the land did not contain residential property, the housing minister has discretion to grant you first time buyer status to buy in a first time buyer development. This could be agricultural land or land inherited jointly with siblings; and
- Similarly, if you have owned property that was once owned by a spouse or ex-spouse, the housing minister will consider your circumstances on an individual, case by case basis in determining whether you fall within the exceptions.
These exceptions will permit you to be considered a first time buyer for the purpose of buying within a first time buyer development, but you will not benefit from reduced stamp duty or land transaction tax.
First Time Buyer Stamp/ Land Transfer Tax
The fact that a property is in a first time buyer development does not automatically confer any concession for stamp duty (freehold) or land transaction tax (share transfer), as different, stricter criteria apply. Also, the price may be above the eligible financial threshold for concessionary stamp duty.
Ownership of property anywhere in the world will mean you are not eligible for the concessionary rates for stamp duty or land transaction tax.
In order to benefit from first time buyer status for these purposes you must:
(1) have permanent Entitled status (or be buying jointly with an Entitled spouse or civil partner)
(2) not have previously owned property; and
(3) not be paying any more than the threshold for qualification for relief (currently £500,000).
Entitled status is awarded to those individuals who have lived in Jersey for a period of 10 years permitting them to buy, sell or lease any property in the Island.
If you hold Licensed status (essential employment) you cannot benefit from concessionary stamp duty or land transaction tax even if you are a first time buyer.
Confused?
It's highly advisable to speak to your lawyer or conveyancer early. You are likely to be paying a fixed fee so make the most of it by getting the right advice at the start, which can save you money and headaches later on.
With a trusted adviser on your side, the experience of buying your first home will be the positive one it should be.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.