With less than two months to go before the first phase of the Stamp Duty Holiday ends, online mortgage firm Habito explains how buyers can make the most of the opportunity
If you are buying a home – or are thinking of doing so – you will most certainly be aware of the Stamp Duty Holiday which is currently taking place.
Its launch back in July 2020 was intended to kick-start the property market, and the economy, following the closure during lockdown.
And it has most certainly had the desired effect.
So much so it was extended beyond its original deadline of 31 March. There are now two stamp duty deadlines to be aware of, if you’re thinking about buying a home.
The full stamp duty deadline – which allows for no tax to be payable on homes up to £500,000 is applicable to those buying before 30 June 2021.
Then, from 1 July until 30 September 2021, no tax will be payable on homes up to the first £250,000. After 30 September, stamp duty at the full rate will resume which means that it’ll be payable on all homes costing over £125,000.
Abigail Fairley, legal counsel at Habito, said: “Buying a home can take longer than you think and every day is valuable right now, lots of people are trying to meet the first deadline of 30 June.
“There’s been lots of reports in the media about homebuyers experiencing delays and backlogs for searches, surveys and solicitors.
“The on-going worry is of course about not making the stamp duty holiday deadline, but there are a few things you can do, to give yourself the best chance of completing in time.”
Here are Habito’s top tips to help give you the best chance of completing in time to take advantage of the tax break.
Instruct solicitors ASAP
Firstly, if you’re buying, then instruct your solicitors BEFORE having an offer accepted. Solicitors are already incredibly busy, but there is lots of admin and form filling you can get done in advance, so when offers are accepted you can hit the ground running.
Be responsive
Respond to your solicitors requests for information and documents straight away – buyers often say they want to move quickly but then take time to do this, which causes delays!
Go online
If you’re still not sure how to pick a solicitor, keep in mind that they don’t have to be local to you, as many now work online.
At the very least, ask them what their availability is like over the summer, so you know they’re not overwhelmed with new instructions and yours is simply being added to a huge pile.
Sellers: Be selective
If you’re selling, then consider carefully the options of the offers you get. For example, is your buyer chain free and if not, how many other parties are involved?
Long chains tend to slow things down and if you’re in the position where you have competing offers from different buyers – choosing a lower offer from someone who’s chain-free could be the difference between making the completion deadline and not.
Keep up lines of communication
Communicate! There are lots of parties involved in a transaction – make sure you speak to your solicitor throughout, they are duty bound to look after your interests. Misinformation can lead to incredible stress in these high-pressured, time-bound sales.
You could also think about opening a dialogue with your sellers. It always helps to build a connection and chances are they want their sale to go through as smoothly as you do.
Be mindful of dates
Don’t put off your completion. Sometimes buyers are given the option to dictate their exchange and completion dates – either to a date that suits them, to happen on the same date or one to two weeks apart.
For the full relief from Stamp Duty Tax you need to have completed by 30 June 2021, or for half the relief, by 30 September 2021 (not just exchanged).
So firstly, make sure you keep this date in mind, secondly know the difference between exchanging and completing, and thirdly, if you’re offered a choice of date – take the earliest one to be safe and give yourself contingency time in case anything happens.
Finally… Try to relax
As easy as it is to say, try your best not to stress about it. It can be horrible to feel powerless in this situation, but if you’re doing everything in your power to respond to any requests of you and your time, and turn-around your required paperwork without delay, there’s little more you can do but let everyone crack on.
Don’t hound the parties involved in the transactions as they will be trying their best, but do feel empowered to check in on progress if you’ve not had an update for a while.
