The stamp duty holiday tapered on 30th June, with the maximum saving falling to £2,500 from £15,000 until the end of September. However, could the end of the holiday produce a silver lining for those wanting to make their move as normality resumes?
Chancellor Rishi Sunak's stamp duty holiday, introduced in July 2020, was designed to support the UK economy through the pandemic.
Its merits as a way of stimulating wider economic activity are clear, but the decision to extend the holiday by six months beyond the original March 2021 deadline is more open to debate.
The UK election acted as a catalyst, releasing frustrated buyer demand that built up during five years of Brexit-related political uncertainty. Demand was amplified further still as people reassessed their homes during successive lockdowns.
The distortive effect of these factors and the stamp duty holiday combined have contributed to double-digit house price growth in the UK. And yet, we've seen a 'wait and see' attitude among some, contributing to lower levels of supply in 2021 as sellers were put off entering the market.
Tom Bill, Head of UK Residential Research at Knight Frank, explains why the end of the holiday can be viewed as a positive development, signalling a return to normality.
Meanwhile, we’ve identified six more reasons why now just might be the right time to make your move.
1. Demand outstrips supply
There were 12 new prospective buyers for each new instruction to sell in the UK in May.
2. Attractive lending landscape
The Bank of England is not expected to raise historically-low interest rates in a meaningful way any time soon.
3. Record personal savings
UK consumers have saved over £203 billion during lockdown.
4. Market set to normalise and house price growth predicted to slow down
Knight Frank forecasts 5% growth for UK property prices in 2021 as supply and demand re-balance.
5.Strong employment underpins the market
Unemployment is forecast to peak at 5.5% in the autumn, far lower than expected at the start of the pandemic.
6. The choice of properties is getting bigger
Vendors are starting to come back into the market. In May, market valuations in the UK were 75% higher than January and above the five-year average for the month.
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