In July, Chancellor Rishi Sunak announced new tax cut measures in a bid to try and boost the property market again after the Covid-19 lockdown was imposed in April. Although only a temporary measure, the expectation was that the Stamp Duty ‘holiday’ will instil confidence in the housing market and encourage buyers to take advantage of the reduced rates of tax.
While transactions had significantly slowed down due as a result of logistical issues, as well as a lack of confidence in the sector, the intention of the stamp duty cut was to bring more buyers back to the market.
The stamp duty holiday, as part of a package of measures to support jobs and the UK economy, means that anyone buying a property, could save up to £15,000. This incentive has been a fantastic jump-start for the UK economy, and has already seen homes sold within a week of going on the market,
Despite this positive influx of investment, there are drawbacks already coming to light which you will need to look out for if you are an active buyer in the current market.
While there are currently a whole 204 days left of the stamp duty holiday, there is mounting evidence that there are already log jams and delays when it comes to conveyancing, surveys, mortgage valuations and local authority searches. These services are struggling to deal with the influx of demand brought about by the stamp duty holiday, with a lot of staff still furloughed or working from home creating further delays.
John Creasey from Rightmove said “We’re likely to see a bottleneck of transactions build up in the run up unless the government opts for an extension.”
Creasey added, “The problem we have is working out how big this backlog is, and some services have been trying to ascertain their clients’ intentions for some time.”
With these delays in mind, the HomeOwners Alliance suggests at least starting your search by October 1st if you want to complete your purchase by March 31 2021 when the holiday ends.
To find out how you can take advantage if the stamp duty holiday contact us