“The sensible thing” - Agents urge tapered end to stamp duty holiday

Estate agents have kept up the pressure on the Westminster government to consider some kind of tapered ending to the stamp duty holiday.

Earlier this week a virtual debate amongst MPs showed a substantial number from both main parties advocating some sort of phased extension, purely for those buyers already part way through transactions.

Now estate agents have voiced their backing for this.  

Tom Bill, head of UK residential research at Knight Frank, says: “The housing market hit peak uncertainty during the pandemic in January. Ambiguity surrounding the end of the stamp duty holiday came at the same time as stricter lockdown measures and the arrival of new Covid variants …  The initial wave of pent-up demand that began in May 2020 is now clearing through the system, accelerated by the end of the stamp duty holiday. The sensible option would be to taper the holiday and avoid any cliff-edge moments.”

Jeremy Leaf, London estate agent and a former RICS residential chairman, comments: “The market is catching up with itself as the chances of buyers and sellers beating the stamp duty deadline by the end of March recede, even if a withdrawal is phased, as seems possible now. Those likely to miss out on the stamp duty saving due to backlogs tell us they would prefer to compromise on price rather than miss out on the property they have set their hearts on.”

Director of Benham and Reeves, Marc von Grundherr adds: “The party is nearly over where a stamp duty reprieve is concerned, but will homebuyers still be dancing when the music stops? There’s a strong possibility that a period of heightened instability is on the cards as the end of the stamp duty holiday causes a spike in sales falling through, while buyers also look to renegotiate terms having missed out on a stamp duty saving. This market wobble could result in a far more notable decline in house prices as the deck is reshuffled.”

Sam Mitchell, chief executive of online agency Strike, states: “Many will be questioning how long demand can last, particularly in the context of the wider economic changes on the horizon, from rising unemployment levels to the impact of Brexit and uncertainty around stamp duty. However, ongoing low interest rates and higher loan to value lending, coupled with vaccination confidence and people continuing to reassess what they need in a home, will definitely continue to help demand remain strong for a long time to come.”

Guy Gittins, managing director of London agency Chestertons, says: “The government’s decision not to extend the stamp duty holiday is very disappointing and could see a period of mayhem leading up to the deadline and on deadline day itself. This decision will mean two months of unnecessary stress for countless buyers, sellers and property professionals at a time when they already have more than enough on their plate.

“The one thing that is abundantly clear is that this Stamp Duty Holiday has enabled thousands of people to afford to move; something that they have possibly been putting off for the last three years. This shows that the current stamp duty structure requires an urgent review, particularly in light of peoples’ changing needs following the pandemic.”