Thousands of house sales are in peril as stamp duty holiday ends
Thousands of house sales are in peril as stamp duty holiday ends: Frantic buyers threaten to pull out to avoid £15,000 tax bill
- Solicitors are working around the clock but buyers are threatening to pull out
- Is feared that four in ten sales agreed before April 1 will not complete by June 30
- More than 160,000 buyers could miss out on tax savings of up to £15,000
Thousands of property sales are at risk of falling through if they are not completed before the imminent stamp duty deadline.
Solicitors are working around the clock but buyers are threatening to pull out as the window closes.
It is feared that four in ten sales agreed before April 1 will not complete by June 30.
That means that more than 160,000 buyers could miss out on tax savings of up to £15,000, according to property data firm TwentyCi.
The stamp duty holiday applies to properties worth up to £500,000.
Thousands of property sales are at risk of falling through if they are not completed before the imminent stamp duty deadline
The knock-on effect could cause thousands of property chains to collapse, causing even more buyers and sellers to lose their dream homes.
Buyers are increasingly complaining that solicitors are not picking up the phone or replying promptly.
During the first lockdown, some firms made entire conveyancing teams redundant.
When the market bounced back more quickly than expected, many struggled to rehire and are now running on skeleton staff – who are often still working from home.
Solicitors have described the market as ‘frantic’, with worried buyers throwing tantrums ahead of the deadline. Estate agents said the market is in a ‘mess’ as panicked sellers resort to moving into rented properties so their buyer does not pull out.
Buyers are also struggling to find removal companies, with many fully booked for the whole month.
The stamp duty holiday on properties up to £500,000 was introduced by Chancellor Rishi Sunak last July to kickstart the market after it was frozen at the start of the pandemic.
The policy, combined with pent-up demand and a desire to upsize after lockdown, has pushed prices up to record levels.
Solicitors are working around the clock but buyers are threatening to pull out as the window closes
More than 300,000 transactions were tipped to miss the original stamp duty deadline of March 31, according to TwentyCi.
But before the window closed, the Government extended the holiday until the end of June.
After June, the stamp duty-free threshold drops to £250,000 until the end of September.
While the extension gave breathing space to those at risk of missing the first deadline, it also opened the floodgates to a wave of new buyers.
And with under three weeks to go, solicitors have reported that some buyers have begun throwing in the towel, while others are bombarding their offices, desperate for updates.
To stop buyers from pulling out, some sellers are resorting to extreme measures. Je
remy Swan, of Jeremy Swan estate agents in Great Missenden, Buckinghamshire, said: ‘I now have people pulling out of sales, prompting some sellers to agree to break the property chain by moving into a rented home.
‘But many can’t find anywhere to live because the rental market has gone through the roof. It’s a mess.’
Moving firm Reallymoving said that after the deadline was extended, requests for quotes more than doubled compared with a normal month.
One in four buyers have said they would try to renegotiate the purchase price with the seller if they missed the deadline, according to Rightmove.
Birmingham-based solicitor Sarah Dwight said: ‘It’s absolutely horrible. Because of the volume of work I have never been this stressed in my entire 30-year career.
‘After this is over I’m seriously thinking I’ll retire.’
Angela Hesketh, of solicitors Jackson Lees, Wirral, said: ‘There just aren’t enough hours in the day and as we run up to the deadline, anxiety and panic are setting in and buyers are losing their tempers.’
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