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Homebuyers rush to beat increase in stamp duty
Property market professionals report pressure to complete house purchases before the tax on homes costing £125,000-£175,000 is reinstated in the new year
Staff at Countrywide Property Lawyers, Britain's biggest firm of conveyancers, have had to work overtime to cope with the rush of extra business. Photograph: PA
Solicitors, conveyancers and mortgage lenders are reporting a rush to complete house purchases before the reintroduction of stamp duty on properties costing less than £175,000 on 1 January.
The government announced a stamp duty holiday from September 2008 on properties costing between £125,000 and £175,000 to help first-time buyers and encourage the property market during the recession. Properties costing less than £125,000 were already exempt. But the tax, levied at 1% of the purchase price, will be reinstated on Friday, adding up to £1,750 to the cost of buying a new home.
Property market professionals said there had been extra pressure to finish transactions before the stamp duty is reintroduced.
Staff at Countrywide Property Lawyers, the biggest firm of residential conveyancers in the UK, have had to work overtime and weekends to cope with the extra business. Paul Creffield, the firm's chairman, said: "We've been extremely busy through November and particularly December: we've been dealing with hundreds of completions every day. In the history of the business we've never known anything like this."
Carole Berry, of Rollingsons Solicitors, said: "I had a simultaneous exchange of contracts on the 23 December to make sure the deal went through in time. It was on a property costing £130,000 so the saving would only be £1,300 but for a first-time buyer that can make a big difference."
Nationwide Building Society also reported more completions than expected going through in December. A spokesman, Anthony Hua, said: "We have seen a positive impact in terms of mortgage completions, but it's too early to quantify."
Ray Boulger, of the mortgage brokers John Charcol, said the experience of conveyancers and lenders in December fitted in with the pattern of applications from first-time buyers in the autumn.
It typically takes two to three months to go from making an offer and applying for a mortgage to completion, and John Charcol saw more first-time buyers in October than November or December.
Despite the recent downturn in the property market, the average price of houses in England and Wales is £161,554, falling within the band that will be subject to 1% stamp duty again, according to official figures published today.
The Land Registry said house prices in the UK rose by 0.9% in November, and although they fell by 0.3% over the year, it was the seventh month in a row in which the annual rate of decline had decreased.
In London prices increased by 2% in November and 3.5% over the year – the biggest rise in any region. But prices elsewhere remain depressed.
Property market professionals report pressure to complete house purchases before the tax on homes costing £125,000-£175,000 is reinstated in the new year
- Jill Insley
- guardian.co.uk, Wednesday 30 December 2009 17.46 GMT
Staff at Countrywide Property Lawyers, Britain's biggest firm of conveyancers, have had to work overtime to cope with the rush of extra business. Photograph: PA Solicitors, conveyancers and mortgage lenders are reporting a rush to complete house purchases before the reintroduction of stamp duty on properties costing less than £175,000 on 1 January.
The government announced a stamp duty holiday from September 2008 on properties costing between £125,000 and £175,000 to help first-time buyers and encourage the property market during the recession. Properties costing less than £125,000 were already exempt. But the tax, levied at 1% of the purchase price, will be reinstated on Friday, adding up to £1,750 to the cost of buying a new home.
Property market professionals said there had been extra pressure to finish transactions before the stamp duty is reintroduced.
Staff at Countrywide Property Lawyers, the biggest firm of residential conveyancers in the UK, have had to work overtime and weekends to cope with the extra business. Paul Creffield, the firm's chairman, said: "We've been extremely busy through November and particularly December: we've been dealing with hundreds of completions every day. In the history of the business we've never known anything like this."
Carole Berry, of Rollingsons Solicitors, said: "I had a simultaneous exchange of contracts on the 23 December to make sure the deal went through in time. It was on a property costing £130,000 so the saving would only be £1,300 but for a first-time buyer that can make a big difference."
Nationwide Building Society also reported more completions than expected going through in December. A spokesman, Anthony Hua, said: "We have seen a positive impact in terms of mortgage completions, but it's too early to quantify."
Ray Boulger, of the mortgage brokers John Charcol, said the experience of conveyancers and lenders in December fitted in with the pattern of applications from first-time buyers in the autumn.
It typically takes two to three months to go from making an offer and applying for a mortgage to completion, and John Charcol saw more first-time buyers in October than November or December.
Despite the recent downturn in the property market, the average price of houses in England and Wales is £161,554, falling within the band that will be subject to 1% stamp duty again, according to official figures published today.
The Land Registry said house prices in the UK rose by 0.9% in November, and although they fell by 0.3% over the year, it was the seventh month in a row in which the annual rate of decline had decreased.
In London prices increased by 2% in November and 3.5% over the year – the biggest rise in any region. But prices elsewhere remain depressed.
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