Will he, won't he? Chancellor keeps house buyers guessing as stamp duty deadline draws closer.
Panic is beginning to set in for house movers hoping to take advantage of the stamp duty holiday, with just 37 days left before the front door is due to slam shut.
New figures claim that almost three in every 10 deals are now collapsing as buyers realise they are in danger of missing the Government’s March 31 deadline.
Chancellor Rishi Sunak is said to be on the verge of announcing an extension in next month’s Budget - something the Post has been calling for with its “Don’t Stamp it Out” campaign.
But that will come too late for thousands who have already pulled the plug on moving house, or are victims of a chain breaking down due to uncertainty over when the tax will return.
Rightmove has revealed that 29 per cent of agreed sales fell through in January - up from 28 per cent in December and 27 per cent in November.
And there are real fears that figure will rise even more sharply over the next five weeks as buyers get closer to the cliff edge and face the prospect of having to pay up to £15,000 more than they have budgeted for.
With the average time needed to complete a conveyance now up to 16 weeks in Lancashire - double what it was before the Covid crisis - many deals are under threat as the clock ticks closer to the cut-off point.
Chancellor Sunak will deliver his Budget on March 3, with a stamp duty extension for those deals already at an advanced stage, rumoured to be amongst his announcements, along with more time for business rates relief and furlough payments.
Meanwhile the uncertainty has promoted one finance company to issue a battleplan to help owners whose house moves are hanging by a thread.
“There is still time to complete, but that is reliant on every person in your chain working well together,” said Gary Hemming, commercial lending director at ABC Finance. The key, said Mr Hemming, was for buyers to have honest conversations with their solicitors and also the other people in their chain via their estate agents.
“No matter how well your transaction is progressing, a backlog has built up recently so you must remain vigilant,” he said. “The only way to protect yourself is to make sure you stay well informed on the whole chain and ensure that you’re fully prepared.
“Ultimately, the process needs to be well-managed, and if you’re determined to complete before March 31, I recommend that you stay well versed on every link in the chain.”
If the stamp duty holiday does end on March 31, experts are predicting a slump in the housing market and in the housebuilding sector.
A new report by the Government think tank the Centre for Policy Studies, published today, says the stamp duty holiday warded off a collapse in the housebuilding sector and also meant there were more housing transactions than any year since the financial crash of 2007.
“To prevent a slump in housebuilding and help millions of would-be homeowners, the Government needs to make the new threshold permanent for primary homes or abolish the tax outright,” says the report.
“Such reform would also boost new build construction by an estimated 20,000 homes per year, while abolition would deliver an additional 23,500 new builds annually.”
The CPS’s research shows that 87 per cent of people buying a primary home escaped stamp duty thanks to the holiday.
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