Stamp Duty holiday turbocharges property market once again

Andy Sommerville, Director at Search Acumen, comments on the monthly UK residential property transactions from HMRC, showing stamp duty holiday turbocharges property market once again.

“This data comes as no surprise. The Stamp Duty holiday has once again turbo charged the property market – but not necessarily for the better.

“The sharp rise in monthly residential property transactions has been triggered by homebuyers who put transactions on ice until they knew whether the holiday would be extended picking up where they left off.

“Transaction volumes could soon wane as the impact of the holiday on demand tapers. Activity has been predominately driven by buyers with access to high levels of housing equity, many of whom would have already taken advantage of the higher threshold by the end of May.

“Those who require larger mortgages to finance purchases will be relied upon to lead activity in the market. However, even with the launch of the Government-backed 95% mortgage scheme, credit availability for these buyers remains scarce. The reduction in the number of buyers may cause a correction in transaction volumes in the coming months.

“It is time for lenders to accept property data products that can be delivered instantly, rather than relying on Local Authority Searches which are time consuming and cumbersome to produce. Expanding access to reliable data sources used by lenders has the capacity to speed up and improve the quality of risk assessment procedures and help to facilitate the provision of credit. This will improve the home buying process by making it more efficient and robust for future buyers.”

Kindly shared by Search Acumen

Main photo courtesy of Pixabay