Even though there was only one real mention of the housing market in the Autumn Statement, it was certainly newsworthy for those of us in the industry given the about-turn taking place on Stamp Duty.
Back in the ill-fated mini Budget in September, the then-Chancellor Kwasi Kwarteng announced a significant increase to the nil rate threshold for Stamp Duty. This meant that rather than paying no tax on the first £125,000 of a house purchase, buyers would now pay no tax on the first £250,000.
However, while the new Chancellor Jeremy Hunt kept the tax break in place, he has pencilled in an end date for it, with this increase to the nil rate threshold being withdrawn at the end of March 2025.
Deja vu all over again
Brokers won’t need long memories in order to remember the impact that such deadlines can have, not only on the attitudes of buyers and sellers but on their own workloads too.
After all, during the pandemic brokers had to contend with two separate Stamp Duty deadlines, with the tax initially not payable on the first £500,000 of a purchase, which then dropped to £250,000 between July 2021 and September 2021.
Buying a house has long been an expensive endeavour, so a tax break made it more appealing and affordable. This was only heightened by the realisation that the break was time limited, that buyers would need to move swiftly in order to take advantage.
While the deadline for the current Stamp Duty break is some way away, the reality is that prospective buyers will need to start the process some time in advance of that deadline if they wish to take advantage. After all, the actual process of buying a property can be incredibly slow – according to our own research, the typical time taken to complete has risen from 124 days back in 2019 to 153 days today.
It’s inevitable that as that deadline creeps ever closer, we will see increased appetites from buyers hoping to get their purchase over the line before that transaction would incur a higher tax bill.
Meeting deadlines
As brokers will know, such deadlines can be a huge source of stress. I know that many brokers worked around the clock to try to help as many clients as possible beat the last Stamp Duty deadline, particularly in those last few weeks as things became more stretched.
Yet the stress wasn’t just down to the workloads themselves, but also how little the broker could control. Sure, brokers could make sure they got the applications in on time and that the buyer understood what was expected from them, but there are other parties involved in a deal who also face pressing workloads, including the conveyancers.
When those conveyancing firms struggled to carry out that legal work on time, or at least to an expected timetable, it was the cause of sleepless nights for borrowers and brokers alike.
Having a plan in place
At eConveyancer we are committed to ensuring that brokers and their clients don’t go through that horrible – and potentially expensive – experience.
Having a comprehensive panel of conveyancers for clients to choose from doesn’t just allow them to find a legal firm with expertise in the relevant type of purchase, but it can also avoid such capacity issues.
For example, we hold a weekly pipeline review of cases with the top legal firms on our panel. We want to keep on top of what their workloads are like, what capacity they have available. Doing so means that brokers and their clients enjoy not only a high level of service, but a consistent one too, irrespective of the individual conveyancing firm they opt to work with.
This is an important consideration for brokers and clients at all times, but is only likely to become more significant as we get closer to the Stamp Duty deadline.
Brokers are used to dealing with difficult timeframes – all advisers will have had cases where a client needed to arrange a mortgage or refinance quickly. The ability to work effectively under those time pressures is one of the many reasons that brokers are such crucial allies to borrowers in the mortgage market.
Yet they cannot do it alone. When selecting businesses to partner with, it’s important for brokers to identify those who recognise those time pressures and have measures in place to help brokers and their clients to beat those deadlines and conclude deals swiftly.
Karen Rodrigues is sales director at eConveyancer
