Lockdown heightens call for SDLT holiday extension

As we’re all starting to adapt to the new lockdown restrictions, we’re facing new blockers that may not have been apparent during the first national lockdown.

Conveyancers are already under mounting pressure as clients demand that their housing pipeline is completed before the 31 March deadline. But with logjams cropping up throughout the pipeline, many may miss out on this.

Having such a sharp cut off has resulted in many in the sector calling for an extension to the holiday, whilst others have asked for the holiday to be tapered so as to alleviate the pressure.

Phil Spencer, property expert and TV personality, spoke honestly to Graham Norton on his Virgin Radio show about the repercussions on the market, post 31 March. He said:

“I think chaos would ensure if the stamp duty holiday did end on a specific date, becuase everybody would be working towards that day.

“It is great to keep people motivated towards that day but actually, if they haven’t completed their deals on that date, the chances are that deals will be collapsing left right and center. It will just be bedlam.”

The Location, Location, Location presented added: 

“The market is surprisingly busy and surprisingly buoyant. And given the housing market is generally driven by the sentiment, I would have thought it should be dragging along the floor at the moment. But there’s an awful lot of people trying to do an awful lot of deals just at the moment.”

Andrew Montlake, Managing Director of mortgage broker, Coreco, explained:

“Though the property market remains technically open, there will now be considerably more logistical issues for the simple reason that a lot of people will be working from home.

“Lenders, valuers and conveyancers are already experiencing bottlenecks and delays given the sheer amount of applications going through and the administrative upheaval caused by the latest lockdown will only serve to accentuate them.

“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.”

David Hannah, founder and principal consultant of Cornerstone Tax, commented:

“It is critical that the government reviews this stamp duty holiday, and either announces an extension or amends the tax payment date so that homebuyers can still take advantage of the holiday even if they cannot complete by 31st March.

“The most preferable option would be a phasing out of the holiday, to avoid those who are currently in the process of purchasing their properties, essentially being thrown off a cliff-edge.

“Especially now that the country is being plunged back into another full lockdown, more must be done to help people get on the property ladder and give the market some security in what will be a very turbulent few months.

“Government-backed purchase mortgage guarantees for borrowers would be a great way to reinstall confidence in the lending market. If the term of these guarantees were for five years, for example, the inflation of the housing market during the medium term would wipe off any negative equity on those properties.”

Jeremy Leaf, an agent in London, commented:

“The new lockdown will have some impact on surveyors, removals firms etc and in the circumstances, it would be prudent for the Chancellor to reconsider the stamp duty deadline. Those who have moved heaven and earth to meet the deadline should not now be penalised if they miss it through no fault of their own.”

George Franks, co-founder of London-based agency Radstock Property, comments:

“Extending the deadline by at least another month to reflect the new national lockdown seems like the right thing to do in the current circumstances and I’m sure it’s on Rishi Sunak’s agenda. The property market is providing vital fuel for the economy and the Treasury will want to ensure that continues during the potentially challenging months ahead.”

Franks adds:

“Extending the Stamp Duty holiday is a way for the Government to give people something to cheer about when there’s so little to cheer about, as public sentiment and the property market are closely related.”

Now as a tightening of restrictions is being called for in a bid to curb the grip the coronavirus pandemic has on the UK, only time will tell what move the Government makes. Yesterday, the Labour Leader Sir Keir Starmer called for house viewings to stop when he made his first speech of the year. Although he didn’t ask for a full closure of the housing market, it’ll be interesting to see how the Prime Minister responds to this.