Since July 2020, buyers have not needed to pay stamp duty on properties worth up to £500,000. This has been saving the average buyer around £4,500.
This stamp duty holiday was a means to give the property market a necessary boost after the disruption of the first UK lockdown restrictions due to Covid-19. According to Chancellor Rishi Sunak, property buying and selling fell by 50% in May.
And it appears to be helping. According to Rightmove, there are around 650,000 sales going through in the UK right now. That is 67 per cent more than in November last year.
Backlog of paperwork and less choice?
Now the race is on. The deadline, March 2021, is seemingly speeding towards us. There is growing pressure to complete before then.
And it’s looking extremely tricky for many people. With the pause on the property market back in the year there is a significant backlog in arranging mortgages, valuations and conveyancing.
There is also an apparent issue of insufficient properties available; buyers cannot find houses in their price range.
How to prepare?
Expert advice for those racing to complete before the deadline includes preparing as much as possible, including: readying documentation, borrowing from family, applying for a mortgage offer in principle, surveyor etc.
Also, considering the chain is important. A short or no chain would put a buyer in the best stead. A new-build with the Help to Buy scheme might greatly improve a buyer’s chances.
Another piece of advice is to ask for recommendations of a good and proactive solicitor. Also, using a mortgage broker is helpful as they can chase any delays on the buyer’s behalf.
Even from the start, eight months did not seem like enough time to industry experts. Pressure is being put on the Chancellor to extend the holiday.
We wait and see if an extension will be given.
If it isn’t, there may be an up-side to missing the deadline. While tax bills will go up, demand will perhaps ease and so buyers might be able to negotiate a better price.