Jeremy Hunt’s spring budget didn’t contain many surprises for property lawyers, but the unexpected decision to abolish Multiple Dwellings Relief (MDR) starting 1 June 2024 has caught many off guard. Although MDR was the subject of a consultation by the Government in 2022 and certain changes were expected, few expected it to go completely.
MDR allows certain investors to pay Stamp Duty Land Tax (SDLT) on the average value of each dwelling which can result in large savings. From 1 June 2024, this will no longer be possible save for mixed use properties.
Investors (along with their lawyers) looking to complete a purchase before that date will need to consider ways to safely speed up the buying process if they are to take advantage of the MDR before its expiry. One obstacle which can delay a transaction is receiving replies to Local Authority Enquiries. Many local authorities are reporting delays with some reporting anywhere from between 30 to 35 working days, adding 1 to 2 months to a transaction timeline.
SDLT is payable upon substantial performance of the contract, typically referring to the completion of the purchase, rather than exchange. Consequently, a buyer experiencing a delay of 45-working days is already at risk of being unable to complete before the 1 June 2024 deadline.
Stewart Title can help buyers and their lawyers through our No Local Search or Local Search Delay insurance. These policies provide protection against adverse entries within Local Authority search results, allowing buyers and their lenders to avoid search delays and exchange contracts and complete in good time before the deadline.
These and other Stewart Title policies provide up to £20M in cover and can be conveniently ordered through our Stewart Solution ordering platform.
This article was published by Stewart Title as part of their advertising agreement with Today’s Conveyancer. The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.
