Third of house sales ‘will fall through unless Rishi Sunak extends stamp duty holiday beyond March’

RISHI Sunak was warned that a third of house sales will collapse altogether if he refuses to extend the stamp duty holiday beyond March.

The current moratorium on stamp duty, which makes all sales over £500,000 tax free – has led to a boom in Brits looking to buy homes.

The stamp duty holiday is due to expire on March 31 but the Chancellor is facing growing calls to extend it amid the continued economic uncertainty caused by Covid.

A survey by The Guild of Property Professionals found thousands of homebuyers will pull the plug on their deals if the stamp duty holiday is not extended.

Around a third (31%) said they would very likely cancel their planned move if they had to pay stamp duty, with a further 43 per cent admitting that they would most likely do the same.

Experts fear that with the property industry unable to process the transactions fast enough, sales still in the pipeline early next year will not have enough time to complete before the stamp duty holiday ends in March.

There are over 140,000 more people in the process of buying a new home now than this time last year and an estimated 418,000 homes sales progressing to completion, according to Zoopla.

A large proportion of them was prompted by the stamp duty holiday.

Boss of The Guild of Property Professionals Iain McKenzie warned: “If the deadline remains as it is, only a quarter of the sales agreed in January will complete in time.

“With 140,000 more people waiting to complete sales than this time last year, there will be a significant number of buyers who will have to find additional money for stamp duty if they have not budgeted for it.

“Our hope, and the hope of 71% of the public, is that the Government extends the stamp duty holiday, or at the very least, introduces a phasing out period that will ease the pressure on all parties involved, and will prevent a cliff edge.”

Over a third (38%) said that stamp duty had a big financial impact on the amount they paid, while a further 46% said it had a medium impact on their finances.

The research also found the average value of the property people had bought or were going to buy was £232,500, meaning the average house buyer would face a stamp duty bill of £2,1502.

Earlier this week theTreasury insisted it had no plans to extend the stamp duty holiday – describing it as “temporary relief”.