It is estimated that approximately 300,000 real estate purchases in the UK could benefit from a three-month extension of the stamp duty holiday. According to reports, the prime minister may be set to extend tax cuts With next week’s budget.
The up to £ 500,000 home tax savings announced last summer are expected to end on March 31st.
However, it is understood that Rishi Sunak has decided to extend it for three months, in line with other measures to support the economy.
It is not clear whether the extension will apply to all purchases or only to those that have been tapered and agreed the day before. Lobbying from part of the mortgage industry..
The rush to take a break worth £ 500,000, combined with national blockade restrictions, has led to delays and delinquency in the home buying process, requiring a change in deadlines.
Rightmove, the property listing website, estimates that approximately 100,000 buyers who have agreed to purchase in 2020 will have to pay taxes, for a total cost of £ 15,000, if unchanged.
Combined with sales that may be completed before the June deadline, it means that the Treasury has been tax-exempt for an additional 300,000 transactions at a cost of £ 1.75 billion. He said there was a possibility.
In recent months, tax cuts seem to have led to a boom in trading and prices. Official figures showing prices rose 8.5% in 2020..
Credit referral agency Experian said the number of applications in February was 12% higher than in the same period last year, although it is unlikely to be completed before the March deadline.
Lisa Fretwell, Managing Director of Data Services at Experian, said: “By extending the deadline, we can ensure that these people close their deals and welcome the mortgage market.”
But in the industry, if the prime minister simply extends his vacation, it will only delay the inevitable “cliff edge”, and the new tight deadline means that buyers will continue to try to complete all costs. Stated.
Hedley Adcock, director of real estate law firm Adcocks Solicitors, said buyers are “taking risky strategies to speed up the process,” including skipping real estate searches and valuations.
“If an extension is announced next week, it’s imperative that we also allow a gradual period, such as a deadline for paperwork,” he said.
“In other words, a buyer who has exchanged a contract but has not completed it, or a buyer who has started a transaction before the deadline and can prove that he has paid the attorney’s fees.”
“I’m concerned that if the deadline is simply extended, buyers are expected to continue to take unnecessary risks to support the moving process within a few months,” he added. ..
Stamp Duty Holiday Extension “May Help 300,000 Sales” | Stamp Duty
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