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Rishi Sunak today confirmed that the stamp duty holiday will be extended until June.
Clare Hallett, who has been following the stamp duty holiday, discusses what the latest extension means for the property market and buyers.
Has the stamp duty holiday been extended?
Mr Sunak had been under pressure to extend the deadline, as many groups feared the 31st March deadline would cause a ‘cliff edge’ and result in the loss of hundreds of thousands of sales.
The announcement follows speculation after the plan was leaked last week.
The holiday was originally announced in July last year, as a temporary measure to help keep the property market moving during the pandemic and enables people to save up to £15,000 in tax.
When does the stamp duty holiday now end?
The chancellor announced that the SDLT holiday will be extended by three months, until the 30th of June.
It was also announced that the nil rate SDLT will apply up to £250k until the end of September, before returning to the pre-pandemic rate (£125k) in October.
What does the SDLT holiday extension mean for the property market?
Clare Hallett, Head of Frettens’ residential property team:
"I’m thankful that whilst the cliff edge has been moved, the temporary increase in the nil rate band to the end of September will help those who are unable to complete by the end of June by providing a lesser SDLT reduction.
I just hope that this will be sufficient to ensure a buoyant but realistic property market. His continued support for those with small deposits is also very welcome."
What does the SDLT holiday extension mean for buyers?
We have been working with our clients towards a 31st March deadline since the announcement of the extension last July. The property market was exceptionally busy in the second half of last year as a result.
Many expected the number of sales to slow significantly in the run up to the deadline, however we have not seen that locally.
We have seen a large number of instructions in the first few weeks of 2021, very few if any of which are dependent on a completion before the deadline.
Can I complete my transaction before the deadline?
Anyone looking to complete before the extended deadline who has not already started the process will be fortunate if they are able to.
Conveyancing is a complex process, involving many different parties and agencies.
With a booming market, estate agents, lenders, local authorities, search companies and solicitors are all exceptionally busy. As a result, transactions are currently taking slightly longer than usual.
The vast majority of the beneficiaries will be those who have already started their transactions and agreed a sale or purchase.
People with simple transactions or those with little or no chain may be able to start a transaction now and complete in time for the deadline, but they will certainly be cutting it fine.
SDLT holiday exceptions
SDLT for first time buyers
First time buyers are exempt from stamp duty, so the announcement doesn’t really affect them, apart from any impact on property prices.
A larger than normal proportion of our instructions this year have come from first time buyers. We believe this could be as they’ve been able to save throughout lockdown and aren’t affected by the existing deadline.
You can read my article on the new scheme for first time buyers here.
Buy to let properties and SDLT
Kym Gaisford’s article ‘Does the stamp duty holiday apply to buy to let property?’ explains the impact of the SDLT holiday on buy to let property.
Conveyancing Solicitors in Bournemouth, Christchurch, Ringwood
If you are looking to move and have a question about conveyancing costs or SDLT, don’t hesitate to get in touch. One of our bright team will be more than happy to answer your questions or provide you with a quote.