Stamp Duty Holiday – Why did this need to be extended?

On March 3^rd Rishi Sunak announce the key points of the 2021 Budget. The housing market was one key area of the budget that was causing much speculation, especially as to whether the current Stamp Duty Holiday would be extended beyond March 31^st. The Chancellor had been under what has been termed by the press as “significant pressure” to extend the current Stamp Duty Holiday deadline with a formal petition made to the Government which quickly gained the support of over 150,000 signatures!

Prior to the Budget, under the Stamp Duty Holiday, no stamp duty was to be paid on the first £500,000 of a property purchase that was completed before March 31^st giving a maximum saving of £15,000. According to data from Zoopla, this allowed somewhere in the region of 70 to 80% of purchasers to avoid paying any stamp duty during this window! However, the surge in purchasers wanting to take advantage of the deal, along with the impact of Covid-19 on workload, staffing levels, and practical restrictions to working practices for both law firms and councils created a huge delay in the purchase process leaving many purchasers worried that they would be unable to complete their purchase before the current deadline. To illustrate, the BBC estimated that approximately 300,000 purchases could potentially fall through if they did not complete before the aforementioned March 31st deadline.

Thankfully, the Chancellor announced a three-month extension to the current Stamp Duty Holiday which will now be set to terminate on the 30^th June. Furthermore, the Chancellor announced a new 5% deposit mortgage to be accessible to first-time buyers to help them to get on the property ladder. 5% deposit mortgages were all but withdrawn from the mortgage market thanks to the financial impact of Covid-19 leaving many first-time buyers without sufficient funds to be able to make their first house purchase. Therefore, this ‘mortgage guarantee scheme’ is likely to have been welcomed by many.

At Andrew Douglas Wills & Legal Services, we understand how important it is for our clients to access the best possible mortgage deals, especially given the current financial climate, which is why we have teamed up with our trusted partner firm in order to offer a completely independent mortgage broker service. Whether you are a first-time buyer in Braintree or further afield, contact our expert team of brokers today and take your first step up the property ladder! For further information contact Andrew Douglas Wills & Legal Services to arrange your free initial consultation.

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