“The Stamp Duty Holiday”, a phrase that makes conveyancing professionals shudder.
The government first announced the Holiday in July 2020 and as a result the last year has been a busy one to say the least. The first hurdle has been overcome however, 30th June has been and gone and so has some of the madness as well. A lot of transactions went through in this time and a lot of Stamp Duty was saved, up to £15,000.00 in some circumstances.
The property market has been very active thanks to the Holiday, and it has been great for the sector. Jacksons have recruited some new members of the conveyancing team and have helped to increase instructions as a result. The market is still looking good as the Holiday is still in force for properties £250,000.00 and below.
Richard Knaggs, trainee solicitor, joined our department the day after the Stamp Duty ended in June (a very lucky man). He explains his experience below:
“Knowing I was moving into the residential property team at the start of July, it was quite a relief to see the stamp duty holiday period come to an end. I know how busy the department has been during that period and I think it will have benefited me that all the members of the team aren’t quite as busy as they were and have a bit more time to help me learn the ropes here in residential.
It has been really nice to get into the office on a more regular basis and meet colleagues face to face, something that has become rare over the last 18 months for most people. Everyone has been extremely welcoming and offered me plenty of help as I have settled in. I am enjoying the work here in residential and look forward to the next 5 months in this department.”
It looks likely that the market will continue to boom throughout the rest of the summer and will all come to a head at the end of September 2021 when the last part of the Holiday ends. We suspect another busy couple of months assisting clients to get their properties bought before the final stamp duty assistance ends.
There is a lot a scepticism over the Holiday, arguments have been made that the boost to the sector has made property values inflate higher than normal and when the Holiday ends there is worries that the values of these properties will drop again, leaving some buyers in negative equity.
There are also new worries for first time buyers who are finding it even harder to get on the Property ladder with the increase in property values and the scrapping of Help to Buy ISA and other first time buyer incentives.
It is hard to know what is going to happen at the end of the holiday, will the government look to bring in a new incentive to keep the property market going or will everything go back to the normal rate. There are arguments for both, and for an overhaul of the Stamp Duty rates in general. My opinion on this would be for a new system, if the tax boundary were increased from £125,000 to £200,000, I think the market would be a little more stable and families on lower incomes would be more likely to be able to move.