Freedom Day for residential conveyancers was never going to be 21 June 2021 or 19th July 2021, but today, 1 July 2021, when the generous SDLT holiday rates (which allowed buyers purchasing property for £500,000 or more to save £12,500 (as against the pre-COVID rates)) came to an end.
The observant will note that there is still some degree of tapering SDLT rate reduction. The first £250,000 of the purchase price of a residential property remains outside the scope of ordinary SDLT (although non-resident SDLT and the 3% higher additional rate surcharge have to be taken into account, where relevant). So there is still a saving of £2,500 (on purchases of £500,000 or more) in completing on or before 30 September 2021. On 1 October 2021, SDLT rates are due to go back up to pre-pandemic rates.
The maths has altered yet again and so, for large volume purchases or mixed acquisitions, it is necessary to double check whether Multiple Dwellings Relief (MDR) or commercial SDLT rates are better.
Conveyancers will want to ensure that completion will take place by 30 September 2021, so the standard terms will often be varied to allow for a short window between exchange and completion (especially as 30 September looms).
As of today (1 July), conveyancers will start asking old familiar questions:
- Have you ever bought or inherited a residential property?
- Will this property be your main residence?
because First Time Buyers' Tax Relief – is back!
Thousands of house sales could fall through as the stamp duty holiday tapers to an end. An estimated one in five purchases could collapse after 120,000 buyers missed yesterday’s deadline. Solicitors said that some buyers who forced through purchases in time may have ignored survey results to do so, potentially landing themselves with large repair bills. Data analytics company TwentyCi calculated that 251,584 purchases, which had a sale price agreed by 1 April, were still in process yesterday. Many of the 391,580 who had offers accepted after 1 April may also have been banking on quick completion. A survey by Savills estate agency found that 10% of purchasers who missed the deadline would renegotiate the price and 5% would pull out, with the proportion significantly larger among buyers in the £500,000 to £1m market.