The housing industry is urging the government to extend the current stamp duty holiday by another six months, as homebuyers are racing against the clock to complete their moves before the deadline of 31 March 2021.
BBC News reports that conveyancers are wanting homebuyers that they face long delays with property searches during the pandemic, and may see house sales fall through in the rush to beat the deadline.
In July, Chancellor Rishi Sunak announced a temporary stamp duty holiday that cuts the tax rate to 0 per cent for all properties priced £500,000 and under.
The move was to encourage homebuyers after the shutdown of the industry during the first lockdown. Potential savings of up to £15,000 were enough to kickstart the housing market, but with time running out, here’s what you need to know about the housing market at the moment.
Will the stamp duty holiday be extended?
So far, the government has not announced any news on the chances of an extension to the stamp duty holiday beyond March. Housing minister Christopher Pincher said in the Commons last week: “The government does not plan to extend stamp duty relief, and will continue to monitor the property market.”
Trade bodies that represent estate agents, conveyancers, surveyors and mortgage brokers have sent an open letter to the government asking for a six-month extension, and make an announcement before Christmas.
On average, it takes 123 days to purchase a home. With the current deadline of 31 March 2021, this means prospective homebuyers a matter of days to find a property and apply for a mortgage to complete.
Research has shown there is a strong desire from Brits for an extension to the scheme. With other COVID relief schemes, such as the furlough scheme having been extended more than once, property professionals are cautiously optimistic.
So, what’s holding property sales up?
Despite the second lockdown, montage applications are currently at a 12-month high, with Brits looking to take advantage of the stamp duty holiday.
This has caused serious delays to the mortgage, conveyancing, and surveying processes, which could result in some buyers missing out on the stamp duty holiday in the limited time window.
Also, the sector’s processing capacity has been reduced with the transition to working from home, and property transactions are taking longer than usual, delaying the turnaround from an average of 12 weeks to 20 weeks, according to the open letter.
What if the stamp duty holiday isn’t extended?
Without an extension, potentially thousands of sales could fall through, which will have a knock-on effect on the entire housing market, which so far has recovered well from the previous slump caused by the coronavirus.
As restrictions from the second lockdown continue and the industry deals with a massive backlog of conveyancing admin in the run-up to Christmas, delays are going to be inevitable and it’ll mean some will face an anxious wait.
Buyers and sellers are rushing things to fast-track a house move, but this could mean vital details are overlooked, which in turn, could hold things up further.
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