Stamp Duty holiday: Rishi Sunak urged to extend ‘cliff-edge’ deadline | UK | News (Reports)


Hopes of a stamp duty holiday extension have risen following the Government’s decision to extend other forms of support, including mortgage payment holidays. Ministers have also spared the housing market a second lockdown, in a move that will come as a relief to more than 400,000 who are looking to complete on sales totalling £112billion. However up to half could miss out on the Chancellor’s tax break as property sales slow, due to the stamp duty holiday and pent-up demand following the spring lockdown.

Sales in October were up 52 per cent on last year but property surveyors, mortgage lenders, conveyancing lawyers and local authorities are all now buckling under the sheer weight of demand.

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Jeremy Raj, national head of residential property at law firm Irwin Mitchell, was relieved to see the housing market remain open but said: “Transaction timescales have increased across the board.”

He called for the “cliff-edge” stamp duty deadline to be extended to give people time to complete and avoid “unnecessary chaos and anxiety”.

Kevin Roberts, director of Legal & General Mortgage Club, said Christmas will cause further delays: “Our research suggests that the average time between receiving an offer on a property and completion has increased by eight weeks.”

Roberts called on the Government to taper the stamp duty holiday and urged buyers to use a mortgage broker to avoid delays.

Miles Robinson, head of mortgages at online broker Trussle, said around half of sales agreed after October 22 will not complete.

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“Delayed transactions, increased scrutiny from lenders, tighter criteria and a shrinking range of high loan-to-value products are creating challenges.”

House prices are rising at the fastest rate for five years, up 5.8 per cent in the year to October, according to Nationwide. Guy Harrington, chief executive of lender Glenhawk, warned the current mini-boom may not last as “grim unemployment data” and tighter mortgage criteria could squeeze demand.

“The Government must hope the predictions for a deep recession don’t materialise, otherwise the collapse in sales will unwind this recovery.”

Anna Clare Harper, chief executive of asset manager SPI Capital, dismissed fears of a house price bubble, as mortgage approvals hit the highest level since 2007. “The good news is interest rates are low and are likely to remain so, providing support,” she said.

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Existing homeowners have been protected by the Government’s decision to extend the mortgage payment holiday for a further six months. Mortgage broker SPF’s chief executive Mark Harris said: “The advice remains the same, only ask for a payment deferral if you need one.”

Interest will still rack up which means borrowers will have more to pay off in the long run, Harris added.


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