Stamp Duty Holiday: The Impact of Covid-19 on the Property Market

The pandemic has undoubtedly affected the property market due to changes in ways of working and consuming. The good news is property sales are experiencing a mini boom thanks to financial support schemes.

The government has introduced support schemes to help homeowners and buyers who planned to move or sell before coronavirus affected the UK. This means the pandemic should not put you off your plans to buy or sell properties, at least until 31st March 2021.

How has the pandemic affected the property market?

There is promising growth in the buying and selling of homes due to introduced support schemes and property savings vehicles. On the other hand, Halifax claims that the housing market will be affected by the upcoming economic downturn predicted as a result of Brexit.

Therefore, it could pay to be cautious of falling sales next year. It is quite possible that current growth could slow down, and house prices may rise again. The UK economy faces the prospect of a double-dip recession also.

The current market conditions favor those who currently own a house, or those who are looking to buy without a mortgage. Mortgage approval will likely take a little longer than usual. However, interest rates are considerably lower at present, so bear this in mind too when you are looking to find a property.

On the plus side, Rightmove alleges that the average period for sale agreed has fallen to just 49 days. This means once the sale has been approved, the process can be quicker.

How are buyers and sellers responding to the impact of Covid-19?

According to HMRC (HM Revenue and Customs), a record number of property sales were recorded in October 2020 since 2016. For the long term, home buyers are more likely to buy homes:

What about house viewings?

The Government have advised that potential buyers should only view houses once they are seriously considering a purchase.

This said, it is OK to view houses in-person, if you remain socially distanced and avoid touching surfaces and furnishings. Also, wear a face mask when possible.

At Doorsteps, we help our customers to best present their property no matter the circumstances. For example, we offer a virtual tour which are 200% more effective at encouraging enquiries. We are currently offering virtual tours at 25% off with the code VIRTUAL25.

Furthermore, paperwork can be completed electronically to minimise contact. We can also offer advice, tips and guidance for you to view or sell a house virtually. You can view our COVID Plan online to see how we are keeping our customers safe when selling.  

What is stamp duty?

Stamp duty is a one-off tax deducted from property purchases by the government in normal circumstances. The threshold was as follows before support schemes were introduced this year:

Stamp duty holiday

Since 8th July 2020, stamp duty has been removed for existing homeowners upgrading or downgrading to a property valued under £500,000. Home buyers can save up to £15,000. For more expensive properties, stamp duty has been reduced to the following:

You may find this stamp duty calculator helpful to see how much you could save.

If you are just starting to think about buying or selling – as currently the deadline for stamp duty holiday is only three months away – we suggest waiting to see how the growth and government changes in the next few months. This said, generally there is growth and asking prices are slightly lower.

Is it wise to sell my house now?

As house prices are marginally higher currently, it is not a bad idea to sell if you were planning to soon.

Property prices are likely to fluctuate unexpectedly due to stamp duty holiday, and this can cause uncertainty. This said, there is conflicting information online as the market changes month-to-month in line with new guidelines.

Coronavirus is likely to slow down moving periods as agents are busier. Mortgage valuations and legal action can be slowed due to market changes and increased demand. However, the property market is certainly not doom and gloom for prospective sellers and buyers.

Our agents can advise you further if you are still undecided about selling your home. Contact us now via phone or request a call back online to open a discussion about your property. We are ready and waiting to help.

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