November 20, 2020

What To Know About Stamp Duty Into 2021

As homebuyers are hurrying to complete purchases before the stamp duty holiday deadline of 31 March 2021, housing industry experts have urged the government to extend the tax relief by a further six months.

Homebuyers have been warned by conveyancers they there could be long delays to property searches due to the pandemic, which may see thousands of house sales fall through in the race to take advantage of the stamp duty holiday, according to BBC News.

The stamp duty holiday was announced in July by Chancellor Rishi Sunak, as a temporary measure that cut the tax rate to 0 per cent for properties priced at £500,000 and under, in a move to encourage homebuyers and kickstart the housing market after the shut down of the industry during the first lockdown.

There are potential savings of up to £15,000, but with the clock ticking and time running out, here’s the need-to-know about the market at the moment.

Will the stamp duty holiday be extended?

There has been no news so far on the chances of the government extending the stamp duty holiday beyond the end of March.

Housing minister Christopher Pincher said in the Commons last week: “The government does not plan to extend stamp duty relief, and will continue to monitor the property market.”

An open letter was sent to Whitehall by various trade bodies that represent estate agents, conveyancers, surveyors and mortgage brokers, urging for a six-month extension, and to make an announcement before Christmas.

It can take 123 days, on average, to purchase a home, meaning that prospective house buyers have now a matter of days to first find a property and apply for a mortgage to beat the deadline.

Research has shown there is a strong desire from Brits for an extension to the scheme. With other COVID relief schemes, such as the furlough scheme having been extended more than once, property professionals are cautiously optimistic.

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