The stamp duty holiday (which was due to end in March) could be extended by a further three months.
Back in January, Advantage wrote that there had been increasing calls for the stamp duty holiday to be extended – both to allow for delays in the system caused by the third lockdown, and to galvanise the property market if the restrictions proved to be a dampener.
According to a new report by The Times, the Chancellor will use his Budget on 3rd March to extend the tax break in order to keep the property market firing as Britain gradually exits lockdown.
As reported by Sky News, the Chancellor had been urged to push back the stamp duty deadline as many people have been left scrambling to complete their transactions before the end date – with the property website Rightmove estimating 100,000 could miss out.
Under the current rules, the stamp duty threshold has been temporarily raised from £125,000 to £500,000 for property sales in England and Northern Ireland. In Scotland and Wales, it was increased to £250,000.
As Advantage has previously noted, the stamp duty holiday has helped to bolster the property market during a period of uncertainty.
The stamp duty holiday effect continues to have an impact
Property Reporter stated that figures for January have shown that the stamp duty holiday effect continues to impact the market, with the average number of prospective buyers registered per estate agent branch seeing a 40% rise against figures from December.
The latest data and analysis from Propertymark reveals that the rise to 487 prospective buyers per branch is a 27% increase from 382 in January 2020.
Propertymark data also revealed that during January, a record 26% of property transactions took over 17 weeks from the offer being accepted to exchanging contracts. The average number of sales agreed per estate agent branch stood at 10 in January, an increase from eight in December. This is the highest figure recorded for the month of January since 2007 when an average of 13 sales were agreed per branch.
A full or tapered stamp duty holiday extension?
Estate Agent Today says that what isn’t yet clear is whether the extension is three months for all current and new buyers of properties up to £500,000 – thus creating a new cliff edge – or a ‘tapered’ extension only for current buyers.
They add that the extension is precisely the same length advocated yesterday by the Building Societies Association.
The BSA says that with the 31st March cliff edge deadline fast approaching many buyers and sellers, who have already agreed sales and have mortgages approved, would be unlikely to complete the transaction within the deadline.
The Times also reports that the Budget next week will see the extension of the furlough scheme (which was due to end on 30th April) for up to another three months.
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