Fylde coast property businesses call for Stamp Duty extension as pressure mounts to complete house deals by deadline

The scheme, brought in by Chancellor Rishi Sunak in July, suspended the tax on the first £500,000 of all property sales in England and Northern Ireland to help boost the market and combat the effects of the coronavirus restrictions.

It proved massively popular with homeowners, one study suggests 147,969 house sales have been carried out since July, but is due to end on March 31 and the hard deadline has meant a desperate rush to get deals over the line to avoid an extra bill of thousands of pounds.

The hard deadline has seen solicitors overwhelmed with work and has pushed the price of homes up over the past months.

But many solicitors, estate agents and house builders want the deadline extended, but this time with phased cut off so as not to create a pinch point in demand.

Linda Kirk, director and head of conveyancing at Adkirk Law in Watery Lane, Preston, said that the latest lockdown, following on from the Christmas break, had piled on the pressure for those buying or selling houses now and could result in many deals not being done before the stamp duty deadline passes and therefore a nasty extra payment shock for customers that they had not budgeted for.

She said: "It has been a difficult time for everyone involved. Covid has made everything in the process so much slower with so many different challenges meaning it is much harder to progress sales.

"People are feeling the pressure. We are experiencing a massively higher volume of calls and emails from people selling or buying homes, from estate agents, other solicitors, from everyone. In the first two and a half days back after Christmas we had 300 calls about conveyancing.

"If we had an extension to the stamp duty holiday beyond the end of March it would ease the pressure on people. It might be a good idea as well to have a staggered end to the stamp duty holiday to avoid another cliff edge, for example have a deadline for people who can exchange by a particular date.

"Extending the stamp duty holiday would be a great idea, but I do understand why the government might not be keen as it would result in another loss of revenue."

Lancashire Law Firm Vincents Solicitors is backing The Gazette’s campaign for an extension to the Stamp Duty holiday.

Residential conveyancing is one of the firm’s biggest departments, with more than 20 staff helping homebuyers across its network of six offices in the county and recruitment is ongoing.

The team has received 50 per cent more instructions from homebuyers since the SDLT holiday was announced in June 2020, year-on-year.

Luke Robinson, who leads the conveyancing team in Lytham, servicing clients right across the Fylde Coast, said: “Home sales have gone through the roof, there’s no other way to describe it. I have never known a busier time; we’re all working longer hours and have recruited more staff to help get sales through as quickly as possible.

“It started almost as soon as the Stamp Duty holiday was announced, and is almost all down to that incentive. With the deadline approaching, and sales typically taking 8-12 weeks to complete, it’s become even busier since Christmas.

“The first thing buyers ask is ‘can you get this through before the deadline’ as they know that missing by just a day will cost them thousands in tax or, bearing in mind most sales rely on everything going right for a whole a chain of buyers, could lead to transactions failing.

“The incentive has made moving up a possibility for people who might otherwise not be able to afford a larger property, something that’s become increasingly necessary with more home working and home-schooling, people just need that additional space.”

Luke added that an extension to the Stamp Duty Holiday would be absolutely crucial for the continued vitality of the economy struggling under the effects of the pandemic.

He said: “It would obviously help buyers by reducing their costs, thereby keeping the housing market buoyant, which benefits the whole economy and secures jobs across so many related sectors.

“It would particularly help those buyers already in the process of making the move who may lose out if, for any reason, there is a delay with their sale. And also, obviously, the professionals who are working flat out to meet the deadline on behalf of their clients.

“We’d like to see an extension with a run-off period built in, whereby purchasers who have reached a certain point in the sale are afforded the benefit of the incentive regardless of when the sale actually completes, making the process much fairer for buyers and providing more certainty for the whole market.”

Ben Moore, 31, owner of Ben Moore Bespoke Estate Agent in Cleveleys, said: "The Government's decision to offer stamp duty relief proved to be an incredible benefit to the housing market, during a turbulent year.

"With economic uncertainty looming, the prospect of saving up to £15,000 in taxes has given confidence to buyers, and encouraged a move they may have otherwise been unable to make.

"The incentive has also been a great catalyst for encouraging sellers to take advantage of a market which has experienced surprising fluidity, despite the pandemic.

"If the deadline for stamp duty was extended, I believe it will allow the property market to keep building momentum and continue to flourish during what remains an uncertain time."

Sean O'Toole , managing director of house builder James Carter Homes which is working on a site at Breck Road, said the Stamp Duty holiday had been a shot in the arm for house builders and for related businesses over the past months.

He said: "I would support an extension o the Stamp Duty holiday as it would continue to stimulate the property sector and the economy through increased business and would keep people employed.

"It would be a good thing too for all those working in associated businesses. I think it has helped to keep many businesses going and has been a good initiative by the Government along with the furlough scheme which has been a fantastic support to many businesses."

Hamza Anwar, director at lettings and estate agent Martins and Co in Blackpool, but which also has offices in Lancaster, said the Stamp Duty holiday had been a good idea but should have been extended to landlords to cut the three per cent additional duty they pay to benefit the rental market too.

He said: "It has had a massive impact and, with people being stuck at home in the lockdown, many have found they cannot carry on living in their current property and need to move for more space, so they can have a home office, or gym or a bigger garden. That means demand has soared.

"We have seen transaction volume increase significantly and, as I know for myself trying to buy a new property, it is difficult to get this progressed. I was recently turned down by a solicitor who said they were just too busy. The deadline has caused a lot of problems and I think it would be a good idea to extend it.

"We have seen demand increase hugely this year and that has meant house prices have gone up too.In Blackpool prices went up about one per cent but in other places it has been higher.

"It is just a shame the additional stamp duty investors and landlords have to pay could not be cut as well. There is huge demand in the rental market but not enough properties especially for families. A stamp duty cut would help that."

Research by estate agent Keller Williams UK has looked at the current saving made by homebuyers as a result of the stamp duty holiday.

It showed that 147,969 transactions have completed, to the tune of more than £50.3m, since July 8 last year.

The firm said 85 per cent of these transactions have been below the £500,000 price bracket meaning they’re exempt from paying stamp duty due to the current holiday.

Before the stamp duty holiday, the 147,969 homebuyers would have paid £1.444bn in stamp duty, but thanks to the reprieve homebuyers savied £5.6m a day, and Keller Williams forecasts the total saving come the end of March could be as high as £1.5bn.

CEO of Keller Williams UK, Ben Taylor, said: "While many will grumble about the current market backlogs and the level of homebuyers who could miss out on a stamp duty saving, there’s no denying it has been monumentally beneficial.Not only has it helped revive the market from a demand standpoint, but homebuyers have saved a tremendous amount of money."

WHAT IS STAMP DUTY:

Stamp duty is a tax that people may have to pay when buying property in England or Northern Ireland.

The tax is is tiered, meaning that buyers pay different rates on different portions of the property price.

Normally the rates are £0-£125,000: 0 per cent; £125,001-£250,000: two per cent; £250,001-£925,000: five per cent; £925,001-£1.5m: 10 per cent; Over £1.5m: 12 per cent.

First time buyers don't have to pay on properties under £300,000.

On a house worth £275,000 the duty works out at £3,750.

But since July stamp duty has been waived for properties under £500,000.

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