First-time buyers – and brokers – feel the pressure on the eve of April 1
With the countdown most definitely on before changes to Stamp Duty come into effect tomorrow, property purchasers – particularly first-time buyers – are waiting nervously to find out if they’ll be out of pocket, or save thousands of pounds. Some brokers are feeling the pressure too.
The threshold for first-time buyers in England drops from £425,000 to £300,000 from April 1, meaning that first-time buyers purchasing a £425,000 property will face an additional £6,250 in Stamp Duty Costs. Home movers will see their zero rate threshold halve from £250,000 to £125,000.
“We've got quite a few deals at the moment that are basically time sensitive, so we've got solicitors working all hours,” said Gindy Mathoon (pictured left), a broker at Create Finance. “From a broker point of view, we hate it when there's deadlines in place out of our control, whether it's some sort of Stamp Duty change or when previously, with that end of Help to Buy. We're trying to do our work as quickly as possible. Sometimes you're relying on third party partners, surveyors and solicitors to come through.”
Mathoon said he expected things to remain challenging until today, before a period of calm. “What we will probably see is the market will calm down for a couple of weeks or so, and obviously Easter holidays coming up as well, so I think brokers, solicitors, estate agents, surveyors are going to probably welcome the rest.”
Sam Mason (pictured second from left), founder and managing director of The Mortgage & Protection Hub, acknowledges that it’s a race against time. “There’s definitely a sense of urgency around the Stamp Duty changes,” he said. “As brokers, we’re doing everything we can to get cases over the line before the deadline, but the pressure is real. It’s not just about the workload, it’s the emotional pressure from clients who are understandably anxious about missing out on potential savings. Whilst there's only so much we can do to progress cases, we can't help but feel guilty for the cases that haven't quite made it through.”
While there’s pressure on brokers, it’s arguably even more intense for property buyers, who will feel a financial hit if they don’t make the deadline, and can only wait, with fingers crossed.
“Clients have definitely felt the heat,” Mason commented. “Many are stressed, especially those who have made it right up against the deadline. Some have been fully aware of how tight things are, while others have assumed we can just make it happen, so managing expectations has been a big focus over the last few months.” He added: “Looking ahead, I think we need more consistency and a longer-term vision when it comes to Stamp Duty. Short-term deadlines and temporary reliefs just create chaos. It would be great to see a clearer, more stable policy that supports both buyers and the housing market in a more sustainable way.”
Read more: 'The homebuying process is archaic and needs to change'
Clients were warned to factor in extra Stamp Duty charges
There’s a pragmatic approach from Jonathan Smith (pictured second from right), mortgage adviser at Springate Mortgages. “From December 1 onwards, I've always told clients to factor in the extra Stamp Duty into their plans and if they beat the deadline then they'll be left with a bonus,” Smith said. “Anyone offering this side of Christmas was often not expecting to beat it, but knew it would be a nice surprise if they did. I really feel for anyone whose purchase was agreed mid-December or before as this should have been more than enough time, so if they miss it then someone somewhere has let them down, whether it's the legal process in general, a conveyancer in the chain not pulling their weight, or an apathetic seller.”
He reasoned: “The Stamp Duty holiday was different this time round to the 2021 version. Last time round, the savings were up to 15k, missing it could be make or break for the purchase. Missing it this time and paying 2.5k is something no-one wants but it’s less likely to be make or break. Of course, it’s different for first-time buyers where the potential saving is up to £6,250, which has a much greater impact, so I feel really sorry for them.”
What, then, would Smith like to happen with Stamp Duty, going forward? “No more holidays for a while!” he said. “No-one is going to buy a property because of the holiday who wouldn't be buying at another time anyway. However, it speeds up lots of people, which creates a bottle neck and you then have quieter times because all the people who would have moved then brought their plans forward.”
Meanwhile, broker Steve Humphrey (pictured right), director of The Mortgage Pod, is wishing his life away – or certainly the next 24 hours of it. "I honestly can’t wait for March to be over,” Humphrey shared. “The pressure to get cases through before the Stamp Duty deadline is intense, and service levels across the conveyancing industry have naturally dropped. Clients are understandably stressed, and when they struggle to contact solicitors - especially those we’ve recommended -it reflects on us and our advice. This leads to receiving more client calls, pulling us away from our core mortgage work as we try to maintain our own service levels.”
He added: “The rush will inevitably slow the market afterward, potentially impacting house prices. I’d rather they just leave Stamp Duty alone - constant changes cause more harm than good to the property industry."
