Property experts have called for the Chancellor to extend the stamp duty holiday, in his budget on 3 March, amid delays to the home buying process and threats of an industry lockdown.
Analysis from property portal Rightmove has shown that it is currently taking buyers four months to complete on their property purchases, from having an offer accepted. With more than 600,000 agreed sales “stuck in the processing logjam”, Rightmove estimates that 100,000 of these buyers will struggle to complete on time.
According to Tim Bannister, Rightmove’s director of property data, the challenge of meeting demand has been, “made even tougher by the new lockdown restrictions, Covid-19 sickness and home schooling further reducing capacity in conveyancing, legal searches and mortgage lending”.
In addition, fears have been expressed that the London property market could be shut down as a result of the high coronavirus infection rate in the capital, leading to further delays that would render the holiday “useless”. The Mayor of London Sadiq Khan and has called for a review of essential retail, including estate agents.
The holiday means buyers in England pay no stamp duty on properties costing up to £500,000 or a reduced rate for homes above that, meaning savings of up to £15,000 for people who complete before the scheme’s 31 March deadline.
Among those calling for an extension is the Yorkshire building society, which wants to see a three-month grace period for sales agreed to prevent them from falling through.
However, a Treasury spokesperson said: “The temporary stamp duty cut is helping to protect hundreds of thousands of jobs which rely on the property market by stimulating economic activity. Its time-limited nature is what has encouraged people to take advantage of the scheme.”
Rightmove has also found competitive pricing from sellers looking to tempt buyers before the holiday ends. The portal has reported a 0.9% fall in average asking prices in January – the biggest monthly drop since December 2019.