Industry calls for action to extend Stamp Duty Holiday

NAEA Propertymark has joined forces with sector partners to write to the Chancellor, Rishi Sunak to highlight the emerging crisis in residential transactions, as sales progression and conveyancing are overwhelmed by demand in the race to complete before the end of the Stamp Duty Holiday on 31 March 2021.

The partners, who represent the home moving process: estate agency, search agents, mortgage intermediaries, conveyancing, surveying, energy assessors and removal companies, highlight the fact that average transaction times have escalated from 12 weeks to 20 weeks along with the importance of the sector to the wider economy and the potential for significant consumer detriment. Key to this message, is the need for action to be taken and an announcement to be made to reassure those involved in transactions before Christmas.

Pent up demand which followed the first ‘lockdown’ period, was bolstered by the temporary reduction of Stamp Duty Land Tax (SDLT) which ends on 31st March 2021, the same date as the Help to Buy scheme is due to end.

The letter states that a limited window is now overloading the capacity available to deal with the surge in demand for completions and failure to complete transactions by the deadline is likely to see the breakdown of chains as consumers have budgeted on the basis of the Stamp Duty holiday and cannot afford the additional cost.

The group are calling on the government to:

  1. Announce an extension of the Stamp Duty holiday of at least 6 months before Christmas in order to reduce the risk to the consumer.
  2. Work with the industry to develop a method to help smooth the end of an extended Stamp Duty holiday to prevent another cliff edge.

The joint letter sent to the Chancellor today is an important step in protecting those in the process of buying or selling a house that might miss out on the 31st March stamp duty deadline because of increased pressure on service providers within the industry which is causing delays for buyers and sellers in the sector. The group endorsing this letter represents the breadth of the home moving process including estate agents, search agents, mortgage intermediaries, conveyancing, surveying, energy assessors and removal companies.

The boom, caused by the stamp duty holiday, has been hugely beneficial for the housing market; however, the stamp duty cliff edge on the 31 March could cause thousands of sales to fall at the final hurdle and have a knock on and drastic effect on the housing market which has recovered well from the Covid slump. We are calling on Government to rethink these timings, so pressure on the system can be released to allow transactions to complete and avoid a disorderly and distressing period for movers and businesses throughout the market.

Mark Hayward Chief Executive | NAEA Propertymark

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