Stamp duty Holiday problems

 

Stamp duty Holiday problems

One Wednesday July the 8^th the govt started the stamp duty holiday in the England to stimulate the property market due to the initial damage done to it by the March full National Lockdown and pausing off the housing market, this and pent up demand stirred up by the lockdown has caused a huge surge of people buying and selling property and instigated a mini property boom.

Although this is good for house prices and movement in the economy it has caused issues, firstly the influx of mortgage enquiries to lenders has caused queues for underwriter review, sometimes as much as 2 weeks to just review a case in the first instance. This is not such an issue if the first review does not generate a need for further documents,  if further documents are needed then the case goes back into a queue for another long period . This is when the advice would be to use a knowledgeable mortgage broker who can underwrite the case fully before submitting it so that once reviewed nothing else should be asked for.

Another stumbling block is when a survey is needed for the mortgage; Surveyors are down on staff due to illness or having to self isolate and they are rushed of their feet with the sudden influx of new enquiries, these can be delayed by up to 3 or 4 weeks. 

The big issue that is now getting worse is the searches needed from local Authorities, you have the perfect storm currently huge demand caused by the SDLT holiday and COVID 19 staffing issues , self isolating and people at home sick with the virus . Areas around London have been particularly hit hard due to the location and the large surge in cases over the winter period. Search companies that provide searches to conveyancing firms have traditionally supplied standard searches that cost the same for whatever local authority covers the area of the property in question, so it makes searches more affordable and easier for s conveyancer to order through the search provider’s online portal.

The other type of search is called an official or direct search this is when the search is ordered directly with the council, the main issue with them is the price is different for each local Authority it varies from £150 plus vat up to as much as £500 plus vat and in normal circumstances the search providers searches although slightly slower than are adequate on good value for money. The issue now is that councils are allocating most of their staff to official searches as they get paid more for these and search companies searches are being put on the back burner with stupid estimates of months being quoted as far up to October 2021.

In summary the SDLT holiday, was not though out properly by the government and was rushed out to try and stimulate the economy, but the fact that people will have spent money on applying for mortgage, getting surveys done and possibly missing the deadline of 31^st March 2021 then not affording the cost of being able to complete and having to pull out of the transaction. Might have been better to allow them to complete the transaction if it was started between a certain date than having a deadline that has caused panic and possible financial loss.