The current stamp duty holiday has helped to turbocharge homebuyer demand since it was introduced in July of last year, suspending the tax paid on the first £500,000 of all property sales in England and Northern Ireland.
Wednesday’s Budget is expected to include a deadline extension in one form or another, and Ascend Properties has revealed that homebuyers not only want these rumours to become a reality, but the majority would like to see stamp duty scrapped altogether.
79% want an extension
Ascend’s research shows that 79% of buyers would like to see an extension. 51% want an extension for the whole market, while 28% think it should be restricted to delayed sales having offers accepted before the original March deadline.
71% want more
With stamp duty providing an additional financial hurdle when looking to buy, it comes as no surprise that 71% would like to see this archaic land tax scrapped altogether.
Stamp duty holiday isn’t driving intent to purchase
However, while homebuyers would mostly like to see an extension, the stamp duty holiday hasn’t been the driving influence when it comes to their decision to buy.
Ascend asked if the original introduction of the stamp duty holiday had caused homebuyers to enter the market in search of a property.
52% stated it wasn’t the reason, with a further 36% saying they were already in the process of moving when it was introduced. However, for 12%, it did act as the catalyst for their current property purchase.
Despite the long market delays caused by stamp duty fuelled buyer demand enveloping the market, 61% of buyers have managed to complete and save on stamp duty.
What would a holiday mean for current homebuyers?
For those still in the thick of it and yet to complete, 34% were unphased by an extension, stating they wanted to move anyway, but a saving would be nice if the deadline were extended. 25% also said that delays on their purchase would cause them to miss the original deadline, so an extension would see them save.
However, for the other 40%, a potential extension could have a far more significant impact on their purchase.
20% stated their sale is likely to fall through if there isn’t an extension, with an additional 20% stating they would call off their current sale to look for a different property if more time is granted on the current stamp duty deadline.
Managing Director of Ascend Properties, Ged McPartlin, commented: “The stamp duty holiday has been a success for buyers able to complete in time to secure a saving. However, it’s also caused an enormous backlog of sales due to the industry becoming overwhelmed by the sheer volume of buyers entering the market.
“We can unequivocally say that a deadline extension will benefit more homebuyers should it materialise on Wednesday. At the same time, it’s also likely to exacerbate the current issues of extended purchasing times.
“While many would like to see it happen, a stamp duty saving isn’t the primary driving force behind the intent to purchase, so you have to question whether an extension is worth the many additional months of transactional delays that it is likely to cause.
“Our advice to homebuyers at present would be to act as they would if no holiday was in place at all. You’re going to face delays, and you might not complete even if an extension is implemented. Stay calm, take one day at a time and don’t stress yourself out hoping to save on stamp duty. That way, any saving will come as a bonus, and a failure to secure one won’t bring such disappointment.”
Survey of 1,137 recent homebuyers (last six months) in England carried out by Find Out Now (February 26th 2021).