If you are thinking of moving home, whether that be upsizing, downsizing or your first jump onto the proper ladder, the Government announcement earlier this week to extend the current SDLT ‘holiday’ will no doubt have been music to your ears! Those purchasing homes of £500,000 or less will now have until 30th June 2021 to complete the purchase, and buyers of homes for £250,000 or less will have until 30th September.
SDLT – stamp duty land tax – is ordinarily paid on purchases of properties for a price over £125,000. The rate you will pay depends on your own circumstances; for instance, if it’s the purchase of an additional property, you may be liable to pay an additional 3% tax. If you are a first time buyer, you should qualify for the first time buyer exemption and this means no tax will be paid if you purchase your home for £300,000 or less (this is regardless of whether you complete your purchase before the end of June). Non-UK residents purchasing a property in England will, from 1st April 2021, be liable to pay an additional 2% in SDLT.
Lockdown brought challenges across the board for us all, with many people facing uncertainty with their jobs. This prompted the government to introduce the SDLT holiday in July 2020, with no tax paid on purchases of property for £500,000 or less (depending on individual circumstances). This saw an unprecedented surge in the housing market, which in turn caused bottlenecks across the industry; surveyors were inundated with requests to carry out surveys, mortgage lenders were swamped with new mortgage applications, law firms had a lot of new clients looking to appoint a conveyancer, and local authorities - who provide important search results as part of the home buying process - struggled to cope with the number of search orders they were receiving.
All of this combined has made for an extremely busy period for all professionals involved in helping you move home, and the average length of time it takes to get you into your new home has increased quite substantially.
The Chancellors announcement during his budget this week therefore allowed many of us to breathe a sigh of relief; not for our benefit (we will continue to work just as hard as ever), but for you, our clients. We know just how stressful many of you have found the process of moving home during a pandemic. We have listened to our clients, and those people involved in your chains, when you have voiced your worries about whether the original deadline of 31st March could be achieved when mortgage offers and searches remained outstanding in your chain. Missing that deadline for some of you would have meant tax bills of, in some cases, tens of thousands of pounds.
Does that mean the pressure is off, and we can take our foot off the pedal? Absolutely not. The new deadline of 30th June (for homes of £500,000 or less) is just under 17 weeks away. If you are reading this and have yet to find a house to buy, the chances of you benefiting from the extension are by no means a certainty.
What can you do to help yourselves?
Our award-winning residential conveyancing team here at Crombie Wilkinson are not just experts in our field; what sets us apart is that we care about our clients. We genuinely want to help you achieve your goals and we will do all we can to help you. As a lot of the moving process is out of our control, we can’t offer a guarantee that you will complete by the end of the SDLT holiday, but we can guarantee that every member of our team will do their utmost to move you as soon as is possible. We can also give you some tips so that you can prepare yourselves:
- Speak with a mortgage broker straight away, to ensure that you qualify for the mortgage you need (if any) to assist you with the purchase. Get an offer ‘approved in principle’ so that the mortgage lender is ready to issue the formal offer once your chosen house has been valued.
- Register with as many of your local estate agents as possible, giving them as much detail as you can about the kind of house you are looking for. Most estate agents will actively manage a register of buyers who are looking for properties in their area; you may even be invited to look at a house before it is advertised on the internet.
- Speak with your chosen law firm (you can call any one of our four offices and speak with a friendly member of our residential conveyancing team), agree a price for the work, and formally instruct them as soon as the seller has accepted your offer on your chosen property.
- Pay any costs as soon as you can; valuation fees often need to be paid to your mortgage broker so that the house can be valued. Any delay with this will then delay the formal mortgage offer being issued.
- Speak with your conveyancer and ask if searches can be ordered at the very outset. This may give you a head start if the local authority in that area has a long turnaround time.
- Be honest with your conveyancer about your needs and listen to the advice we give you. We are here to act in your best interests, and we will always be truthful and transparent with you.
- Try not to set any specific moving dates without first discussing this with your conveyancer. We will confirm with the other solicitors in the chain that all parties are ready to move. A moving date can be agreed that this point.
- Trust us. Buying a home will probably be the biggest purchase of your life so far. Trust us to help you complete it.
To discuss any of your requirements, please give our residential property team a call on:
York – 01904 524185
Selby – 01757 708957
Malton – 01653 600070
Pickering – 01751 472121