The current Stamp Duty holiday announced by the Chancellor on July 8th is due to come to an end on the 31st March 2021. The Government temporarily increased the stamp duty threshold to £500,000 for property sales in England and Northern Ireland, meaning anyone completing the purchase of a main residence costing up to £500,000 before then will not pay any stamp duty, and more expensive properties will only be taxed on their value above that amount. This will save buyers as much as £15,000 if they are buying a property of £500,000 or more. It's been a busy old 4 months in the market since the announcement, despite the second lockdown.
Right from the outset it was clear that getting all these extra deals done, driven by the uplift in market activity, was going to be problematic. Mortgage lenders have had some backlogs and surveyors have been very busy, but the real issues in our experience lie with the conveyancing process. There are some delays in getting local authority searches returned in parts of the country, but the bigger problem is that solicitors are simply failing to cope with the increased work load - made worse in our view by furlough, poor communication, lawyers working from home and a lack of consistently well applied technology in the whole system. Many solicitors have stopped accepting new clients at all right now and can't see their way to completing the cases they already have - despite the deadline still being four and a half months away.
It's not a good situation and estate agents will have to step in and try to take more control to get their clients moved in time. There have been pleas to extend the deadline, especially given the second lockdown and the prospect of a slower return to normal from Covid. It remains to be seen what the Government will do and there is no certainty that the current 'cliff edge' of 31st March won't come to pass.
This means anyone planning a move in the first quarter of 2021 needs to act now and take some important decisions. Here are our top tips:
Choose your agent carefully. You will need an agent with experienced, well trained and local staff who place an emphasis on communication and problem solving. Agents with far away call centres, centralised sales chasing, upfront charges and the like almost certainly won't be there for you like a motivated, experienced local firm. Established local agents will know their registered hot buyers and ring your property out to the people most likely to buy it. Just putting it on the internet is not sufficient.
Get the price right. It's important to hit the ground running and capitalise on the impact a well priced, 'new to the market' house brings, backed by a comprehensive marketing approach. Don't fall for the agent who quotes you the highest price and the lowest fee hoping to get a price reduction agreed by you, down to a more realistic asking price, after a few weeks of unsuccessful marketing.
Check the chain. A sale is not a sale unless it is to a proceedable buyer - not someone still trying to find a buyer for their own home or not ready to go. Buyers should be financially qualified by the estate agent to check they can get a mortgage and have the deposit they need. Weeks can be wasted if the buyer can't get their mortgage approved. Long chains can be problematic and every link needs to be checked upfront by the agent to ensure it's all ready to proceed.
Choose the right solicitor - your experienced local estate agent should know which firms are pro-active and who will work co-operatively with them to get the sale moving. It's not all about price. Ask for their recommendation. Get your solicitor instructed as soon as you put your house on the market. This saves valuable time and gets all the form filling done while your agent is marketing the property and finding a buyer.
Pay for your searches up front and answer enquiries quickly. Make sure your solicitor and agent both understand your timescales and are working together to get your move done.
Communication. Agree with your agent and your solicitor when you will speak to them each week to stay up-to-date. Modern firms have a client portal to check progress, send emails and communicate. You are paying for a service from your solicitor as well as your estate agent and you should make sure the expectation is set right from the outset.
Here at Trigg & Co we have two further tools in our toolbox to help get the last minute deals safely across the line.
Firstly - Auction - Sale by Auction gives certainty of a sale on the day and an exchange of contracts within 28 days. Putting your property in the auction with a realistic reserve price does not mean you can't continue to offer it for sale by private treaty right up until auction day - and afterwards if it doesn't sell. Trigg & Co work hand-in-hand with the highly respected mainland firm Pearsons to sell clients properties by Auction. During the Covid crisis, the auction is operating on-line bidding in place of their normal auction day at the Ageas Bowl. As we get closer to the 31st March, we will be recommending more clients consider selling by auction to make sure a deal is completed in time.
Chain Break - Trigg & Co are exclusive agents on the Island for HBB Solutions who operate 'part exchange' and 'chain breaking' solutions. This allows us to arrange to buy in properties from the chain when something falls through and we can offer part exchange options to buyers who may have found the property they wish to buy - but haven't yet sold their own home.
These innovative appraoches will help us make sure Trigg & Co clients have every chance to get their moves completed in time to qualify for the stamp duty tax break - we certainly won't be sitting around just hoping that it happens. We will play our full part in making it happen.
If you are considering a move or currently on the market with another agent and not yet sold, please give us a call on 01983 525710 and have a chat to our friendly, experienced, local expert valuers. You can be certain that we will do everythng we can to - get your move done!