STAMP DUTY HOLIDAY EXTENDED IN BUDGET

The stamp duty holiday on property purchases up to £500,000, has been extended for a further three months, until the end of June, Chancellor Rishi Sunak announced in this week’s Budget.

From 1st July 2021, the nil rate band will then be set at £250,000 until the end of September 2021, it will then return to £125,000 on 1st October 2021.

A mortgage guarantee scheme was also unveiled in the Budget to help both first-time buyers and existing homeowners. Under the new scheme, which will launch in April 2021, first-time buyers and existing homeowners will be able to purchase homes worth up to £600,000 with a deposit of just 5%. The government then pledges to repay lenders some of their losses, if a buyer defaults on their mortgage repayments for any reason.

Figures from property search giant Rightmove estimate that there are currently 628,000 sales going through, which coupled with the challenges of conveyancers, solicitors and councils working from home, has led to delays in the home-buying process. 

The company’s data also shows it is taking an average of 65 days from the time a seller has a property listed by an agent on Rightmove until they get an offer accepted, and a further 126 days to get through to legal completion, which is almost seven months.

Rightmove’s data also shows it is taking an average of 65 days from the time a seller has a property listed by an agent on Rightmove until they get an offer accepted, and on average a further 126 days to get through to legal completion, which is almost seven months. However such extended completion times are very much the exception within the Yorkshire market, although local house sales can be impacted by links in the sales chains elsewhere across the UK.

Patrick McCutcheon, head of residential at Yorkshire’s largest independent estate agent, Dacre, Son & Hartley, said: “The 31st of March stamp duty deadline had the potential to deliver a cliff edge to transactions. The conveyancing profession have been working incredibly hard to ensure that home movers can achieve the saving, but the extension of the relief now takes some of that pressure off the system itself, as well as easing the emotional pressure that home buyers are currently experiencing during what is already a challenging environment.

“Buying a home is an incredibly exciting time; but beyond that, the purchase supports a whole industry of home moving and furnishings related businesses and tradespeople. First time buyers are the engine room that ensures the overall liquidity of the housing market and we very much welcome this move to provide mortgages to homebuyers who put forward a 5 per cent deposit.”

Rightmove’s Tim Bannister explained that the stamp duty holiday extension should give tens of thousands of home-movers the chance to complete before the new deadline. He said: “This three-month extension will come as a huge relief for those people who have been going through the sales process since last year and were always expecting to make use of the stamp duty savings.

“Our recent data shows one in five sales that were agreed in the same month the stamp duty holiday was first announced in July last year still haven’t completed, so this additional time will make a big difference to help those stuck in the logjam complete their purchase in time before the new end of June deadline.

“Buyers who have recently agreed a sale now have a race on their hands to see if they can also make use of the stamp duty savings, but many with purchases over £250,000 will find that time is too tight to complete before the end of June and so shouldn’t be factoring this into their purchase.

“It’s worth remembering that the average savings vary massively around England, and first-time buyers will still be exempt if they’re buying for £300,000 or less. There are also many other reasons people are choosing to move, evidenced by the strong buyer demand Rightmove has already seen in the first two months of the year.”