How Long Is The Stamp Duty Holiday?

Posted on by convey_admin

Conveyancing professionals have been concerned that many property buyers were going to miss out on the stamp duty holiday because of backlogs in the property market. However chancellor Rishi Sunak has extended the stamp duty holiday in this month’s Budget meaning that anyone buying a home costing up to £500,000 before the end of June will now not pay SDLT, saving up to £15,000, with a reduced discount available until the end of September. 

The Property Market

The reuptake of the property market and the introduction of the tax break has proved popular with both the number of transactions rising and property prices increasing sharply. However, delays caused by the influx of homebuyers to the market could result in many missing the relief when the deadline ends, which is currently set to be 31st March.

The immediate reaction to the stamp duty holiday was positive. The August House Price Indexes from both Nationwide and Halifax recorded an average monthly rise in prices of around 2% and a year-on-year increase of 5.2%, surpassing almost any price growth forecasts for 2020. The buyer demand that had accrued during lockdown was being released back into the market, initiating strong growth in house prices across the UK as a result.

However, some research suggests that the SDLT holiday might only be having a limited effect; of 1,262 homeowners and homebuyers surveyed by Market Financial Solutions, a small majority of 52% stated that they would like to take advantage of the SDLT holiday but are concerned about their ability to obtain a mortgage.

See our Stamp Duty Land Tax Calculator for a quick and easy way to see how much extra additional buyers would need to budget for.

What Do The Experts Say?

The Society of Licensed Conveyancers (SLC), the Bold Legal Group (BLG) and the Conveyancing Association (CA) are now working together to examine the potential ways in which the home buying process can be improved. They also intend to examine ways to manage the expectations of those currently engaged in the process of home buying and selling. All three organisations issued a joint statement requesting that the existing stamp duty holiday is “extended to avoid further disappointment in the spring”.

They all state that there are several factors currently contributing to delays in the process, and it is important that buyers, sellers, and the estate agents working for them, are aware of the current circumstances and potential limitations of the SDLT relief, and make allowances for them.

Unprecedented Circumstances

Conveyancers are dealing with an unprecedented set of circumstances, many of which put pressure on the natural progression of property transactions. The market is seeing a volume of transactions not experienced since the recession. Many people are re-evaluating where they want to live as a result of the Covid-19 epidemic. Together, the SDLT holiday and the impact of Covid-19 on the legal profession has resulted in conveyancers being pushed to the limit. Not only is this creating a challenge to the many involved with the conveyancing profession, but the dependence on external parties to progress transactions is causing issues to conveyancing experts. Furthermore, restrictions brought in to deal with Covid-19 mean that many local authorities are operating under extreme difficulties. This has affected their ability to conduct searches and provide access to data for personal search companies. 

Many mortgage lenders are experiencing delays in supplying letters proving their intent to lend and valuers are under extreme pressure too. Whilst there are delays with searches, surveys, mortgage offers and pretty much every other aspect of the process, it is more likely that disruptions to the process will happen.

Being able to plan for the current market circumstances is an enormous challenge. Not surprisingly during lockdown, many law firms furloughed many of their staff and there were some redundancies. As local/national restrictions were lifted, firms were faced with the challenge of making workplaces Covid secure which usually meant fewer employees at their place of work.

Here at Conveyancing Expert we believe that buyers should not be denied access to the opportunities made available through the SDLT holiday due to factors outside of their control. Homebuyers should not be victim to the collapse of their property chain due a mortgage application being denied or delayed. If the right action is taken, we should all be able to enjoy the benefits of a sustained UK property market resurgence for the foreseeable future. 

Conveyancing Expert are renowned for delivering an excellent and efficient service. Our goal is to ensure your purchase, sale, re-mortgage or transfer of equity, is completed to the highest standards with the support of our expert conveyancing advice.

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