Lawyers have called for urgent action to stop tens of thousands of property transactions collapsing at the end of the stamp duty holiday.
The stamp duty land tax holiday is due to end on 31 March. Many people who rushed to take advantage of the opportunity are now waiting nervously to see whether their transactions will go through in time. Those in a chain are particularly vulnerable.
According to homebuyer website Rightmove’s House Price Index January 2021, the average time to complete is more than four months, and about 100,000 buyers could miss out on the stamp duty saving.
The Law Society is urging its members to write to their MP requesting action to protect consumers ahead of the Chancellor of the Exchequer’s budget on 3 March.
Law Society president, David Greene, said the ‘abrupt end’ of the holiday ‘combined with a bottleneck in the market could cause significant disruption.
‘Thousands of transactions and chains could collapse at the last minute, leaving consumers who had hoped to take advantage of the concession to move into their dream home instead stranded and saddled with unrecoverable costs for transactions that fell through. Urgent action needs to be taken to soften this cliff edge and protect homebuyers and sellers from being out of the scheme, out of luck and out of pocket.’
It suggested three courses of action―extending the holiday, to give buyers more time to complete; tapering the end of the holiday so buyers can benefit from a reduced concession, to smooth the cliff edge; and introducing a grandfathering scheme where sales that have reached a certain stage by the deadline but not completed can still benefit from the holiday.
The level of anxiety among residential conveyancers and other property professionals was revealed in a survey of 600 by conveyancing search and software companies tmgroup and mio. The results, published this month in the report, ‘Thriving in a pandemic’, found conveyancers struggling with the pressure of work. The majority agreed the verdict on whether to grant a holiday extension would have a bigger impact on their role this year than either COVID-19 or Brexit.
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