Chancellor Rishi Sunak is reportedly considering a six-week holiday extension after March 31 to prevent buyers from being caught in a “completion trap”.
Details are scarce, but this is unlikely to be a general extension of the tax break. A short-term extension could mean a six-week amnesty for buyers who made sales or traded contracts before the March 3 budget.
The real estate industry has called for the holidays to be streamlined. This would give overloaded carriers some leeway and reduce the number of buyers who are withdrawing from sales as they suddenly have to get their hands on an extra £ 15,000 when their transaction does not complete on time.
The stamp duty policy could perfectly reflect its approach to the purchase assistance equity loan program. Builders and homeowners have had an additional two months to complete homes and transactions until May 31.
Mr Sunak is under increasing pressure to extend the stamp duty holiday past its current deadline so that thousands more buyers can enjoy savings of up to £ 15,000. A petition to extend the six-month deadline has more than 150,000 signatures.
The telegraph argued that the leave should be extended for well over six weeks.
Extending the tax break for another nine months until the end of 2021 would increase transactions by about 10% this year, according to a study by real estate agent Hamptons International – pushing sales from 100,000 to a total of 1, 2 million.
Samuel Tombs, Pantheon Macroeconomics, said the housing market will “fall into a deep sleep” when the tax break is removed.
Daniel Pryor, of the pro-free Adam Smith Institute, said: “I fear the end of the holidays seriously threatens Britain’s economic recovery.”
In July, Chancellor Rishi Sunak raised the zero rate bracket on home purchases in England and Northern Ireland from £ 125,000 to £ 500,000, meaning 88% of transactions are tax exempt.
Sales have since exploded, but there are clear signs that the market is increasingly volatile and will not be able to resist the removal of the incentive. The holidays will end as the taxpayer-funded holiday scheme ends in April and unemployment is expected to hit 7.5%.