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03 March 2021
Approximately just over 300,000 property purchases in England could benefit from a 3 month extension to the stamp duty holiday.
The introduction of the stamp duty holiday last year in March saw many people take advantage of this situation, especially first time buyers, being an increase of 5% in the first time buyer sector.
With much pressure from independent and governing bodies, Rishi Sunak has decided to extend the stamp duty holiday by 3 months, possibly saving 100,000 transactions from losing out on the tax break.
The extension is welcomed but hasn’t been made very clear. It doesn’t tell us if it will be applied to all purchases or would be on a tapered basis and apply to those individuals who agreed before an earlier day.
Saving of around £15,000 per property saw an increase in demand by 12% YTD. This has indeed put pressure on businesses involved in the home buying process therefore the call to remove the deadline has been suggested by many.
Some portals have suggested that if it is not changed, approximately 100,000 buyers who purchased a property in 2020 will have to pay tax, an additional £15,000.
If the deadline is extended then this could see an additional 300,000 transactions take place at a combined cost to the treasury of £1.75bn.
The tax break has impacted the housing market positively in some views. An increase of 8.5% in 2020 was unexpected till the stamp duty holiday was introduced. The desire to take advantage of this has seen an increase of 12% in people applying for mortgages.
We are all in favour for the extension however will this not create the same scenario in 3 months’ time? People will still miss out! The fear of missing out is also impacting home buyer behaviour with many skipping viewings and valuations.
If an extension is announced then it is vital that a tapering off period is also granted such as paperwork deadlines etc.
The introduction of the stamp duty holiday last year in March saw many people take advantage of this situation, especially first time buyers, being an increase of 5% in the first time buyer sector.
With much pressure from independent and governing bodies, Rishi Sunak has decided to extend the stamp duty holiday by 3 months, possibly saving 100,000 transactions from losing out on the tax break.
The extension is welcomed but hasn’t been made very clear. It doesn’t tell us if it will be applied to all purchases or would be on a tapered basis and apply to those individuals who agreed before an earlier day.
Saving of around £15,000 per property saw an increase in demand by 12% YTD. This has indeed put pressure on businesses involved in the home buying process therefore the call to remove the deadline has been suggested by many.
Some portals have suggested that if it is not changed, approximately 100,000 buyers who purchased a property in 2020 will have to pay tax, an additional £15,000.
If the deadline is extended then this could see an additional 300,000 transactions take place at a combined cost to the treasury of £1.75bn.
The tax break has impacted the housing market positively in some views. An increase of 8.5% in 2020 was unexpected till the stamp duty holiday was introduced. The desire to take advantage of this has seen an increase of 12% in people applying for mortgages.
We are all in favour for the extension however will this not create the same scenario in 3 months’ time? People will still miss out! The fear of missing out is also impacting home buyer behaviour with many skipping viewings and valuations.
If an extension is announced then it is vital that a tapering off period is also granted such as paperwork deadlines etc.
About the Author...
Deepak Bhopal is a seasoned estate agent with over 20 years of experience in the real estate industry. He began his career managing a thriving city branch, where he honed his skills in property man...
Read about Deepak