Support, Advice and Experience within the Property Market

Call for Extension to Stamp Duty Cut

From Robert Ulph on January 22, 2021

To give the housing market a boost, a group of 50 Conservative MPs are calling on the Chancellor, Rishi Sunak, to extend the current stamp duty cut for a further 12 months and it is a move that NAEA Propertymark fully supports.

In July last year the Chancellor announced a temporary stamp duty holiday that cut the rate of stamp duty to 0% for all properties £500,000 or under until 31 March 2021. It was to help get the market moving again after the first lockdown period and meant that as an example, purchasing a property for £400,000 as a main residence, the stamp duty would be £0 compared to £10,000 before the holiday. There were also cuts for buyers of additional properties, for example buy-to-let investors, and the scheme has provided the much-needed boost to the sector with house sales, mortgage loan approvals and borrowing all up from earlier in the year.

The MPs are reiterating concerns from industry experts that an end to the stamp duty holiday will trigger a plunge in house prices and transactions this year. The Right Hon Jake Berry MP, who leads the group, has warned that “to relinquish support now would cause long-term damage to large parts of the country and weaken our recovery”.

John Stevenson MP commented “what the Chancellor did was very, very beneficial for the housing market. The stamp duty cut gave it confidence. Maintaining that confidence in the housing market is beneficial for the wider economy. The housing market is a big chunk of the economy, it has a huge supply chain behind it.”

NAEA Propertymark puts its support behind the campaign and also have continued their call for an extension to the property tax holiday. In representation to the Budget 2021, Propertymark has called for an extension to the stamp duty cut for at least another six months and the allowance that those who have an offer formally accepted prior to the end of the current cut to stamp duty or any further extension, qualify for the relief.

“The boom, caused by the stamp duty holiday has been hugely beneficial for the housing market,” Mark Hayward, Propertymark Chief Policy Advisor, stated, “however, the stamp duty cliff edge on 31 March could cause thousands of sales to fall at the final hurdle and have a knock-on and drastic effect on the housing market which has recovered well from the Covid slump.”

“We support the call to the Chancellor to extend the stamp duty cut, and we have been calling on Government for some time to rethink the 31 March deadline, so pressure on the system can be released to allow transactions to complete and avoid a disorderly and distressing period for movers and businesses throughout the market.”

I will keep you updated, but if you have questions on this or require any advice on the local property market, please do not hesitate to contact me as I am always happy to help.