Estate agents who are grateful for Chancellor Rishi Sunak’s stamp duty holiday to keep the market booming post-Covid may be paying for it later on.
Government figures just out show that the measure, which was roundly applauded by the industry when it was launched and then extended last year, helped decrease the government’s overall SDLT tax take by £2.82 billion, or a 19% drop over the past 12 months.
This included a 25% drop in land and residential SDLT while the holiday was in force, dropping from £11.6 billion during 2019/20 to £8.67 billion during 2020/21.
But the biggest drop was for just residential SDLT receipts, which dropped by a staggering 29% during the same period.
As readers will recall, during his Summer Economic Update the Chancellor announced a temporary increase to the nil rate band for SDLT to £500,000 from 8 July 2020 to 31st March 2021 for residential properties.
The effects of this are still being felt in the sales market now, although not everyone believes it has necessarily been a good thing.
“It has created a boom, and driven prices even higher – probably not what was intended” commented Phil Natusch, Managing Director of conveyancing platform mio (pictured).
“The reasoning behind The Stamp Duty Holiday seems clear; there were concerns about a pandemic-induced economic meltdown; adding stimulus to the property market sought to mitigate that.
“With hindsight, it was unnecessary, and even harmful; it has created a boom, and driven prices even higher – probably not what was intended. It’s too early to judge the longer term impacts on the North versus the South, mainly I’m hoping there isn’t a post-party hangover.”