Agents and property experts have reacted angrily to the government's refusal to extend the stamp duty holiday.
The government has told campaigners that it “does not plan to extend the relief” beyond March 31 next year.
“This is in response to the petition with the caveat that the government constantly reviews all matters of revenue” says Mark Hayward, policy advisor at NAEA Propertymark, which had been consulting with the government over the issue.
TV property expert Phil Spencer expressed complete exasperation at the government's intransigence.
He tweeted: "The stamp duty holiday has been successful in activating the market. Ending on a cliff edge will create utter chaos! Surely it can be phased out? Timescales on deals slip more often than they don’t. The motivation behind people moving could disappear in a single day. Utter madness!"
Meanwhile Knight Frank agents have also expressed disappointment.
“The conveyancing system has been struggling massively and that will intensify as a number of people will be trying everything possible to get deals over the line before the end of March” says Luke Ellwood, a London Knight Frank agent.
“What I hope this shows the government is the need for measures to speed up the sales process in future” he continues.
Another Knight Frank agent - Charlie Taylor in Bath - says: “I can’t remember a time when we had so many transactions under offer and solicitors are really struggling to cope ... However, early guidance from government might not be a bad thing as leaving it to the last minute would have been chaotic. This may focus minds and solicitors will be able clear the backlog before March.”
The apparent unequivocal statement from the government follows an online petition calling for an extension. Because that petition exceeded 10,000 signatures (in fact it’s now well above 22,500) the government was obliged to respond formally.
That response says: “As the relief was to provide an immediate stimulus to the property market, the government does not plan to extend this relief. SDLT is an important source of government revenue, raising several billion pounds each year to help pay for the essential services the government provides.
“The government is committed to supporting home ownership and helping people get on and move up the housing ladder.
“When the SDLT Holiday ends, the Government will maintain a SDLT relief for first time buyers which increases the starting threshold of residential SDLT to £300,000 for first-time buyers that purchase a property below £500,000.
“In addition, a new Help to Buy scheme will be introduced from 1 April 2021. This scheme will run until March 2023.
“All tax policy is kept under review and the government considers the views it receives carefully as part of that process.”
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We knew from the beginning when it started and when its due to end. Yes some transactions will miss out but having this stamp duty holiday it better than having nothing. It will highlight those good agents and solicitors who work closely to get them over the line. Its about managing your clients expectations. We know its taking up to 22 weeks for exchanges to happen, so anything agreed in November onwards shouldn't financially be reliant on the saving. if it is then there's a lot of fall throughs going to happen. Don't bury your heads in the sand, deal with it.
You can be the best agent and solicitor in the world, but with 12 weeks for a local search, and 12 for mortgage offer there is not much that can be done. That said, every deal we have arranged this month has not been reliant on the holiday, pity no other agent in my are can compute that and is lining their clients and themselves up for a fall.
If it's not phased then 2021 = caboom, mass fall through's, agents going under, Rightmove fee increase of 11%+ as they are just so amazing!. Will be an interesting year.
Probably not worth predicting tomorrow let alone 2021.
Who’s Rightmove?
This government is prone to last-minute decisions and U-turns - just look at Covid and Brexit. Originally, we weren't going to lockdown, then we did. Originally, the furlough scheme was absolutely going to end, then it wasn't. Originally, there was going to be no second national lockdown, then there was. Then they decided on the ill-thought out five-day Christmas window at a time of rising infections, now they seem to be backtracking on that in all but name. The list of U-turns is long and extensive and speaks of a government which doesn't really have a clue, led by the arch ditherer who doesn't like making tough decisions or upsetting people. Only when his hand is forced, does he act.
In this case, I don't think there will be a U-turn, but if the pressure continues to build, the government may be forced to act. Unfortunately, Jenrick is supposedly in charge of MHCLG and he couldn't organise the proverbial in a brewery. Pincher at least seems a little better, but I wouldn't bet on the government having any kind of long-term plan or strategy, as it's so ably proved with Covid and Brexit.
Was there more that agents could have done or still be doing to help the situation and reduce timescales? My drum skin is wearing out. Moving people is not just about the thrill of getting a board up any more, agents MUST get involved with stuff that they previously may have felt uncomfortable advising clients on. We are working with more and more progressive agents that have woken up to the facts that things have to change. The system is broken and agents can either help to fix it or continue to complain about conveyancers. What are you going to do? A version of 'get legally prepared dot co dot uk' can be white labelled and made bespoke for your business today for FREE. get in touch if you want to be part of the solution and be an agent with a true differentiator in your marketplace.
Why is it madness? There has been no reversal of a decision, no hint from government that there would be an extension, so why the exasperation? If you have been over promising to your clients and failing to manage their expectations do you really deserve to have them as clients?
The SDT holiday wasn't needed in the first place where I work in High Wycombe. The market demand moved upwards in January 2020 after the election of a 'strong' majority government. The market activity after the first lockdown ended in May and June maintained this with figures across the board (vals/inst/viewings/sales) over-performing.
Extending the SDT holiday just pushes the conveyancing blockage problem further down the line. I sincerely hope and would say is essential that the Government reinstate the original First Time SDT holiday. Failure here would cause significant adverse effects on market demand.
Crucially, and what I am never hearing in the trade is the need for Government involvement/intervention with the Lenders who are crucifying the 10% first time buyer market (interest rates almost doubled) under the guise of risk protection. Does anyone know what, if anything, is being done here?
The property market is out of sync with the rest of the economy. We are in the biggest recession in 300 years, the stamp duty holiday has created a false market for home owners and house movers who appear to be blind to the issues in the economy and will undoubtedly regret buying over the last 6-9 months when the market crashes. Extending the SDLT holiday creates false hope and the Gov are right not to extend it.
Lets really go deep into the hole!!!! What an attitude.
BAN REFERRAL FEES AND REGULATE ESTATE AGENTS BY LAW. MANY WILL FAIL TO MEET BASIC STANDARDS. CONSUMERS WILL BENEFIT.
I would think honouring the stamp duty for sales with memorandums issued prior to March 31st sensible. That’s the only black and white true “cut off” that is unarguable. Otherwise the stamp duty holiday may as well not exist from today as the degree of success/failure is so high.
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