100,000 sales ‘will miss stamp duty deadline’
HOME buyers are facing tax bills they had not budgeted for – as around 100,000 house sales already agreed are set to miss the deadline for the stamp duty holiday.
The cut-off is March 31 and property website Rightmove said it now takes just over four months on average from an offer being accepted to a sale being completed.
Which means odds are now stacked against buyers putting in an offer in the coming days to beat the deadline and save “up to £15,000”.
The stamp duty threshold for residential purchases was temporarily raised to £500,000 in July last year but will revert to £125,000 on April 1.
There are different rules for firsttime buyers, who may still get discounts.
But Rightmove said a logjam of 613,000 agreed sales currently in the system include around 100,000 that could miss out on the stamp duty saving.
This could cause difficulties for those who had banked on potentially saving thousands on the property tax. There are also signs that sellers are
still hoping to tempt buyers the stamp duty holiday ends.
Across the UK, sellers’ average asking prices fell by £2,887 or 0.9 per cent in January, to reach £317,058, according to the property portal.
Tim Bannister, Rightmove’s director of property data, said: “While the tax savings were an added incentive, movers’ desire for more inside and outside space seems to be continuing.
“This new lockdown could be a spur to act in 2021 for those who can before
and who did not do so in 2020. However, there are still a huge number of sales agreed in 2020 that are stuck in the processing logjam and awaiting legal completion, with many hoping to beat the tax deadline.
“For those who fail to do so, there may be difficulties if they have factored the tax savings into their budget calculations.
“The challenge of processing so many transactions in less than three months is made even tougher by the new lockdown restrictions, Covid-19 sickness and homeschooling further reducing capacity in conveyancing, legal searches and mortgage lending.”
Rightmove’s report also quoted Matthew Smith, the sales and lettings director at Thornley Groves estate agents in Manchester. He said: “The suburbs, such as Sale and Altrincham, are absolutely flying.
“People are looking for more outside space, and there’s much more activity at the higher end, ie properties being sold at £500,000 and over, compared to 12 or 18 months ago.
“Many people have outgrown their homes, and with more people working from home and homeschooling, it has really focused attention on getting properties ready to sell.
“Many home movers are financially motivated, so the stamp duty holiday has definitely been a sweetener to kick people into action. Savings of up to £15,000 aren’t to be sniffed at.”
Sue Macey, managing partner of Lodestone Property covering parts of Somerset and Dorset, said: “As we move into the new year, demand is continuing to outstrip supply as people look to set up a new life in the country.”