Special Feature: What impact is the SDLT holiday having on conveyancers? – InfoTrack UK

Scott Bozinis, CEO of InfoTrack UK, has written a special feature that looks at what impact the SDLT holiday is having on conveyancers.

Of all the sectors affected by COVID-19, the real estate sector has posted one of the most remarkable recoveries in recent months. Despite the uncertainty surrounding the pandemic, the rise in home-buying activity has led to impressive house price growth and transactional activity.

The rate of annual house price growth is currently sitting above 5%, and with the Government extending the Stamp Duty Land Tax (SDLT) holiday until the end of June, it is likely this rate will remain high.

It is quite right, then, that there has been plenty of positive commentary about the state of the property market and the impact of government reforms in encouraging new investment activity. However, there has been little public discussion surrounding the immense stress conveyancers and legal firms are currently under.

Since the SDLT holiday was introduced in July 2020, there has been a rise in transactional activity across the property market. Buyers and sellers are in a rush to complete deals before the deadline, yet this surge in activity has only increased the amount of time it takes for this to transpire.

It was recently revealed by GetAgent.co.uk that the total time to sell a property – from the initial listing to the completion of the sale as recorded by the Land Registry – is now sitting at an average of 295 days. What’s more, delays in the process are typically encountered at closing stages of a sale when the necessary legal work is being carried out.

As it stands, the SDLT holiday is due to end on 30 June – this date is fast approaching. As such, there are concerns that conveyancers will not be in a position to complete on all cases they receive by this deadline. The consequences are significant, putting buyers at risk of missing out on a tax break of up to £15,000, despite starting the sale process weeks, if not months, before the deadline expires.

Managing the stress this summer

So, what is to be done to alleviate the pressure conveyancers are facing and prevent as many buyers as possible from falling into a completion trap? In my mind, there are two solutions.

The first has to do with government policy. Rather than enforcing a hard deadline of the SDLT holiday, the Government could instead put in place a transition process. There are plenty of different ways this could be managed.

For instance, the Government could declare that any agreement on a sale made before 30 June will still be liable for the tax relief, even if the sale is not completed and registered before the deadline expires. Another option is announcing an indefinite extension of the holiday with monthly reviews to monitor buyer demand. Once house price growth begins to slow and then reach a stable level, the Chancellor could announce a new deadline.

The second solution involves conveyancers re-evaluating how digital conveyancing can improve how they work. Simply put, conveyancers need to wholeheartedly embrace the technology currently on offer to reduce their workload, streamline processes and stamp out inefficient practices.

Positively, since the onset of the COVID-19 pandemic, more and more conveyancers have been starting to realise the benefits on offer from technology. From automating time-consuming tasks to promoting transparent lines of communication for all those parties involved in a property transaction, there are clear advantages.

Thankfully, there have been some government movements in this regard, too. On 27 July 2020, HM Land Registry started to accept witnessed electronic signatures. Days after this policy reform, the first property deeds to be signed electronically were submitted by The Partnership, a leading property solicitor, using InfoTrack’s SignIT eSignature solution supported by DocuSign technology.

The replacement of ‘wet signatures’ with eSignatures is just one of the many ways existing technology can improve the conveyancing process. Some firms have embraced technology, however there are still barriers for some organisations who might not feel confident about the adoption of digital solutions.

In reality, the use of technology within conveyancing is not a short-term trend. In fact, I am confident that COVID-19 has catalysed a technological revolution that was already beginning to take shape prior to 2020; this digitisation of the industry will bring enduring changes to the way conveyancers work.

Scott Bozinis – CEO, InfoTrack UK

Scott Bozinis is the CEO of InfoTrack UK – the home of digital conveyancing. A powerful suite of solutions from client onboarding and searches to post-completion and e-signature services, InfoTrack digitises the entire conveyancing process to assure compliance and productivity. Its technology takes on the burden of paper-intensive, demanding administrative tasks within a single, award-winning platform. We empower firms to focus on delivering an exceptional client experience with every transaction. InfoTrack; the smart, sophisticated, secure solution for digital conveyancing.

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