Extend the stamp duty holiday

Will The Stamp Duty Holiday Be Extended?

The stamp duty holiday has generated considerable activity in the housing market, but as things stand, it is set to end on 31st March 2021. With the level of activity in the housing market leading to backlogs in the sector, there is a growing number of calls to extended the stamp duty holiday, for fear of prospective buyers missing out.

There is a swell of public opinion in extending the holiday

As of the 7th of December, a petition places on the official Parliament portal has attracted 14,800 signatures calling for a six-month extension to the stamp duty holiday.

The petition states: “Extending the duty holiday for an additional six-months will assist many buyers who are looking to move to a property that they will not be able to afford otherwise. This will help to stabilise the housing market.”

The petition was created by someone who is looking to move into a new build property, which is scheduled to be completed at the beginning of March 2021. If there are delays, the petition creator states they will not be able to afford the overall purchase price of the property, and therefore, they will be unable to move.

This is a set of circumstances which will be replicated across the country, for people buying new build homes, and established property. With the petition attracting more than 10,000 signatures, the Government is duty bound to respond.

Leading bodies are pushing the Government to extend the stamp duty holiday

The Guild of Property Professionals have been joined by many industry bodies in lobbying the Government to extend the stamp duty holiday. They are said to be doing this on behalf of consumers and the property sector. In addition to a letter sent to the Government, The Guild has encouraged members to contact their MP.

Many people have received a standardised response which indicates there is support for extending the stamp duty holiday, but there are next to no details as to how this would happen.

Some of the standardised response reads; “I am confident that this action to support the housing market is protecting and creating jobs. In England and Wales, an estimated 240,000 people are directly employed by housebuilders and their contractors, and between 500,000 and 700,000 employees are indirectly supported in the supply chain. Moving to a new house also boosts the economy, with estimates suggesting that doing so drives additional spending worth about 5 per cent of the house value.”

The letter also highlights the backlog currently experienced in the market, and the impact the cut in stamp duty has had on the market, and the construction sector. The response continues; “There is strong evidence to suggest that the temporary cut to SDLT is having the desired effect, with a 14.5 per cent rise in residential property transactions in July, followed by a 15.6 per cent rise in August. This is in addition to the 30 per cent increase in construction activity in July. I understand concerns regarding the backlog of transactions and the impact this could have on people whose purchases may complete after 31 March and I will alert my ministerial colleagues to the strength of feeling on this matter.”

Ian McKenzie, the CEO of The Guild of Property Professionals, says: “We are encouraged by the fact our Members are receiving replies to their letters regarding the benefit of extending the Stamp Duty holiday, however, we are also aware that at this stage the Government has not agreed to extend the tax break and have not laid out any plans with to regard to a phased-out approach. For the time being, the deadline remains, and many transactions will not make the cut-off. We will continue to encourage our Members and the industry collectively to have their say and send their letters to their local MPs.”
If there is no extension to the stamp duty holiday, there are calls for a phasing out period to assist people who are in the process of purchasing property. Iain McKenzie said; “An extension of the Stamp Duty holiday would be optimal, however, if the Government decides against an extension, at the very least a phasing out period would help lessen the blow to people currently in the process of buying a home.”

If you are purchasing a property or looking to buy a new home, establish how much your stamp duty tax will be by visiting our stamp duty calculator.

At VitalSpace, we appreciate there is considerable uncertainty at these times, and vendors want clear guidance. We are more than happy to provide as much assistance and information as you can. We can be contacted in many ways, which means you can connect with us from the comfort of your own home.

If you need any assistance, please contact VitalSpace today.