Tuesday, 13 April 2010

Halifax paying your Council Tax.

Halifax! Paying half your council tax!!

Only if you have one of their mortgages though[current]:

No catches, no asterisks, no diesis, no... Oh.

Unless your council tax is more than £1,500, and only for the first year.[current]

And only if you get one of two products [current]

That's why if you get a first time buyer or home mover mortgage we'll pay for half of your council tax (up to £750).
The council tax offer is not available on the following mortgages: Halifax staff mortgage scheme, expatriate, buy to let, mortgage free special, retirement home plan, no product fee mortgages or remortgages. Terms and conditions apply.

Council tax is a UK property tax, ostensibly to pay for local services, based on the perceived value of your property some time ago. Contrast to, say, income tax or national insurance which are more centralised taxes. Each council have some lee-way as to how much they can increase it each year.

There are currently 8 'bands' in England, with the lowest band representing houses of a nominal value of £40,000 and below (i.e. back in 1993) and the highest band representing houses of £320,001 or more (again, the nominal value back in 1993.)

While the nominal values haven't changed for a few years (they were due to be reviewed in 2007, but in 2005 that was put off until after the next election in 2010,) the tax charged for each band has steadily risen, and certain home improvements will trigger a re-evaluation of any particular property (usually upwards to the next band.)

Thus, to take an example, Council tax rates for 2010/2011[current] in Gateshead in the North East of England a Band D home (£68,001 - £88,000 in '93) would charge a council tax bill of £1,600.04.

Slightly further south in Durham [current - may break] we have in Sedgefield (Tony Blair's old constituency)  £1,643.17 for a Band D, and just before that £1,531.51 for a Band C property in Seaham (£52,001 to £68,000.)

Now, according to the National Office of Statistics[current] in 2008 (the latest year for which figures are available,) there were 23,830,164 houses considered for their survey of properties eligible to pay council tax. Of these:
Band A: 5,831,148
Band B: 4,660,373
Band C: 5,170,221
Total: 15,661,742

So, back in 2008, 65.7% of the housing stock was in band C or below.

Some of those houses will be in Band C's that now charge more than £1,500. (Admittedly, there will be some Band D houses that charge less than this.)

A substantial number of houses passing hands these days are those already on the housing ladder and are thus likely to be 'upsizing' (along with an expected upsizing in Council tax band that will come with it,) with new buyers few and far between due to the substantial deposits being required to get a decent interest rate on the mortgage.

Just exactly how many people falling for this won't actually get half their council tax paid off by Halifax?

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