Delays and higher house prices see homebuyers fall out of love with the stamp duty holiday

Research by estate and lettings agent, Barrows and Forrester, has revealed that the shine is starting to come off the stamp duty holiday for disgruntled homebuyers who are experiencing long delays and higher house prices as a result of the initiative.

85% of those asked said that the current market bottleneck caused by stamp duty holiday demand has caused their purchase to be delayed.

A further 81% believe that their current sale is likely to miss both the initial extended deadline at the end of this month, as well as the secondary deadline due to expire at the end of September.

In addition to lengthy delays, current homebuyers are also facing a far higher cost as a result of the stamp duty holiday. Since the introduction of the stamp duty holiday, house prices across England alone have climbed by 10.2% meaning the average homebuyer is now paying over £25,000 as a result.

Previous research by Barrows and Forrester found that based on the current average monthly rate of growth, this could climb further still, hitting £291,667 in England by the end of the year.

With many now facing this higher cost of homeownership without the benefit of a stamp duty saving, it’s no surprise that 54% of homebuyers stated that they didn’t think this stamp duty holiday price surge had been positive for the market.

23% were on the fence, while just 24% thought it had been a good thing.

Managing Director of Barrows and Forrester, James Forrester, commented:

“It looks as though homebuyers have now fallen out of love with Rishi Sunak and his promise of a stamp duty saving, as many now face lengthy market delays, higher house prices and the salt in the wound of having to pay stamp duty on their purchase.

As with most government housing initiatives, the focus was never really on bringing genuine benefit to homebuyers. The aim has always been to stimulate the housing market in order to claim it as an indicator of economic success against the pandemic backdrop.

Of course many will have enjoyed a saving, but for many more, an already lethargic and stressful process has been made even worse and these homebuyer woes look set to continue for some time.”

Survey of 1,191 UK homebuyers carried out by Barrows and Forrester (28th May 2021).