New research from Property Reporter has revealed that there is an overwhelming demand for an extension to the Stamp Duty Holiday for those who have begun the buying process but have yet to complete.
The government is facing mounting pressure from inside and out of the industry to extend the scheme. A new online petition which was started at the end of October last year has attracted over 54,000 signatures calling for the deadline to be moved to September 2021 and property expert Phil Spencer, speaking on Virgin Radio recently, advised that "Chaos would ensue" if the scheme ended on a specific date, "because everybody would be working towards that day."
However, so far, MPs have not moved from their official stance on the matter and confirmed last month that the government “does not plan” to extend the temporary relief offered to property buyers via the stamp duty holiday.
The Treasury says: “The SDLT holiday was designed to be a temporary relief to stimulate market activity and support jobs that rely on the property market. The government does not plan to extend this temporary relief.
“The COVID-19 pandemic and subsequent lockdown caused uncertainty for those buying and selling residential property and property transactions fell by as much as 50% during the first national lockdown.
“To stimulate immediate momentum in the property market and to support the jobs of people whose employment relied on custom from the property industry, the government decided to introduce a temporary Stamp Duty Land Tax (SDLT) relief. This relief increased the starting threshold of residential SDLT from £125,000 to £500,000 from the 8 July 2020 until 31 March 2021."
With the government seemingly stonewalling any request for an extension on the scheme as it stands, Property Reporter thought that maybe a compromise was perhaps the way to go forward and asked over 8,000 followers on its official Twitter account "Should there be any conditions for an extension to the Stamp Duty Holiday?"
By far the most popular compromise was an extension to the scheme for those who have already begun the purchasing process but have yet to complete. According to the poll, 45.1% favoured extending the Stamp Duty Holiday for those sold STC only, reducing the pressure on brokers, estate agents and conveyancers who are at near-breaking point at the moment due to the backlog caused by the pandemic and the scheme itself.
In second place was an extension with no changes to the current scheme. 27.5% of respondents said that the scheme should be extended as it stands with no amendments put in place. If the petition gains further popularity and hits 100,000 signatures it will be considered for debate in Parliament, piling further pressure on Rishi Sunak.
Property expert, Andrew Montlake, said: "We would not be surprised if the Treasury makes an announcement this week about extending the stamp duty deadline to keep demand alive and give the property industry some much-needed wiggle room."
21.6% felt that the scheme should continue for first-time-buyers only. As it stands at the moment, the stamp duty holiday will only benefit a small number of first-time buyers purchasing homes in more expensive areas. Instead, the scheme is slightly skewed to favour existing homeowners moving up to a more expensive property. Recent data from Rightmove confirms this with reports of a 49% increase in enquiries on properties priced between £400,000 and £500,000 - out of the reach for most who are taking their first step onto the property ladder.
Finally, 5.8% said that the scheme should be extended with "other" conditions. Feedback revealed that these included further raising the threshold and having an open-ended extension (effectively scrapping the tax altogether).
Warren Lewis, Property Reporter editor, comments: "The latest lockdown will only compound the pressure on current transactions with many working from home and falling ill. It seems to make sense that extending the current scheme for those who are already committed to the buying process and allowing them to complete is the right thing to do.
"The data we collated seems to echo this national sentiment, but with an ever-growing pipeline of transactions and MPs remaining tight-lipped, the time to prevent a chaotic end to the scheme along with the hopes of thousands of prospective home movers is running out.
"However, it's not uncommon for this government to drop a massive u-turn on policy out of nowhere, so we'll have to wait and see."