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TODAY'S OTHER NEWS

Have buyers been conned about the stamp duty holiday benefits?

An estate agency says disgruntled and delayed property buyers are fast falling out of love with the stamp duty holiday, which has added weeks and stress to their purchase. 

In addition, many of the homes they are buying are now more expensive as a result of the house price inflation triggered by the holiday.

The estate agency Barrows and Forrester says in a survey of buyers, some 85 per cent blame the stamp duty tax break for delays in their own current purchases.

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A further 81 per cent believe that their sale is likely to miss both the initial extended deadline at the end of this month, as well as the secondary deadline due to expire at the end of September. 

In addition to lengthy delays, current homebuyers are also facing a far higher cost as a result of the stamp duty holiday. Since the introduction of the stamp duty holiday, house prices across England alone have climbed by some 10.2 per cent - meaning the typical buyer is spending some £25,000 more than before the break was launched last summer.

Against that backdrop, some 54 per cent of the 1,191 buyers surveyed by the estate agency last week believe the stamp duty holiday to have hurt the market; 23 per cent were on the fence while just 24 per cent thought it had been a good thing.

“It looks as though homebuyers have now fallen out of love with Rishi Sunak and his promise of a stamp duty saving, as many now face lengthy market delays, higher house prices and the salt in the wound of having to pay stamp duty on their purchase [if they pass the threshold]” says Barrows and Forrester managing director, James Forrester.

“As with most government housing initiatives, the focus was never really on bringing genuine benefit to homebuyers. The aim has always been to stimulate the housing market in order to claim it as an indicator of economic success against the pandemic backdrop.

“Of course many will have enjoyed a saving, but for many more, an already lethargic and stressful process has been made even worse and these homebuyer woes look set to continue for some time.”

  • Andrew Stanton CEO Proptech-PR    Proptech Real Estate Influencer

    Yes in many ways saving 15K on SDLT and buying a 500k property that was 'worth' 450k 10 months ago is not excatly a win. Many have bought compromise properties having sold for great money only to find that as they trade up - big money only buys them average housing stock. There may be lots of steam yet in the market, but the largest tranche of FTB's will have bought all they want to buy, as we hit June (as is the case in every year) and the BTL brigade are not likely to fill the bottom of the market gap with property at sky high values.

  • Michael Day

    There is a long history of Government interventions in the housing market. Nearly all created a short term boost followed by a period of retraction.

    Governments invariably take short term decisions in order to get re-elected rather than fundamentally change things that might take longer to show true benefit.

    This intervention slightly different in that it kept the entire residential sales industry trading during the depths of the pandemic plus ancillary business.

    Stamp duty needs a complete overhaul and reform of the home buying and sales process, use of digital etc will accelerate.

  • icon

    We do not need government intervention in housing market any more. The housing market should not be seen as the saviour of the economy. interventions causes lots of long term problems, like boom and bust. The housing market should be left to grow naturally and not be pumped with hormones like they do it with chickens.

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    Laffer Curver - they just don't get that meddling either way buggers a market. On another note - I had a mortgage offer delayed the other week because the processing teams agent's printer broke! apparently they are all sending them out from home! - what a joke. If in doubt, blame covid for shocking service.

  • Welsh  Cynic

    The stamp duty holiday has been proven to have been unnecessary. Land Transaction Tax (the Wales version of Stamp Duty) offered far more modest savings and yet inflation and activity in the market has been the same as in the rest of the UK. A well intentioned policy, but in hindsight, not required.

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