Jed Elverson, of estate agent Potter & Ford’s financial division, comments of the Government’s temporary stamp duty changes
With the best estimate of the cost of Covid-19 currently standing in excess of £300bn, the nation must look to balance the books. One area of the government’s economic strategy is to kickstart the housing market into life by raising the starting level of Stamp Duty to £500,000. This is good for estate agent’s, mortgage advisers, removal companies and solicitors, all of which have been more or less idle during lockdown.
Furthermore, when somebody moves, they invariably want to make a whole host of changes giving a boost to many types of business from textile retailers to electrical providers to trade sectors. All in all, it is not difficult to see that a thriving housing market creates a dynamic engine that can quickly start to drive the economy forward.
The ’masterstroke’ is that the stamp duty changes are immediate and short-lived ending, as they do, in March 2021 which means you have to act quickly. And the early signs are this boost to the economy is working. The number of houses being listed for sale has dramatically increased with the buyers returning too. Certainly, a built-up number of people who were planning to buy or move this year anyway, have taken the earliest opportunity to now do so and that was possibly always going to create a mini property boom. However, you can add to this a good number of homeowners whose enforced stay within the walls of their current home has made them realise they perhaps don’t have the outside space they want. Or, they need a dedicated room they need to work from if a future lockdown is required or it becomes a chosen way to work by either them or their employer. Whatever the reason, the sellers and buyers seem to be out and, as a firm who employs mortgage advisers, we are very grateful for the activity after 3 months of being idle. So, maybe the stamp duty change only added to a desire to move that was already in existence but as a policy, it has certainly ensured the frenzy of activity is continuing. For the time being anyway!