Why mortgage brokers must be stamp duty ready

Stamp duty deadline is approaching — will firms be ready, or caught off guard?

Why mortgage brokers must be stamp duty ready

Mortgage brokers and property firms must prepare for a potential surge in demand as the UK housing market nears a change in stamp duty thresholds, according to Target.

The digital transformation and outsourcing provider cautioned that without adequate preparation, firms risk operational bottlenecks, delays and dissatisfied clients.

The warning follows concerns that first-time buyers and home movers will rush to complete transactions before the deadline at the end of March, potentially straining brokers, lenders and conveyancers. Previous stamp duty changes have triggered similar surges, leading to backlogs at key stages of the homebuying process, including at HM Land Registry.

Industry groups, including the Association of Mortgage Intermediaries (AMI) and the Intermediary Mortgage Lenders Association (IMLA), have advised members to manage client expectations and prepare for worst-case scenarios. Failure to meet the deadline could mean higher costs for borrowers and reputational risks for brokers and lenders.

Target suggested that firms invest in technology to streamline processes and increase capacity ahead of the expected demand spike. 

“Given how bloated transaction times have become, there’s every chance that those in the process or getting ready to move will have likely missed the boat,” said Melanie Spencer (pictured), sales and growth lead at Target.

“While a good broker will already be having this conversation with clients to manage expectations and make the necessary adjustments to budgets, it won’t stop buyers from trying. Firms absolutely need to prepare for a spike in activity and be ‘stamp duty ready’ before the new thresholds take effect.”

Spencer also noted that lessons should be learned from the previous stamp duty holiday, which placed unsustainable pressure on the sector.

“For those that remember the previous stamp duty holiday, the scars will still be very fresh,” she said. “Arguably, many sectors are still recovering as workloads became unrealistic, client expectations were high, and people left the industry. To avoid something like this again, firms at every level need to be looking at their processes and their current systems to ensure they can keep pace if things escalate again.” 

Technology, she added, will be key in helping firms manage increased volumes efficiently.

“There’s no doubt technology will play a critical role, helping to drive efficiencies in mortgage application, lender decision-making and throughout the entire process to help facilitate transactions and minimise the burden on firms and their staff,” Spencer said.

“Outsourcing key processes will be an asset too as firms look to avoid operational strain, maintain service and avoid reputational damage.” 

Want to be regularly updated with mortgage news and features? Get exclusive interviews, breaking news, and industry events in your inbox – subscribe to our FREE daily newsletter. You can also follow us on Facebook, X (formerly Twitter), and LinkedIn.