The chancellor Rishi Sunak is under growing pressure to extend the stamp duty holiday beyond 31 March, amid concerns that thousands of buyers could fail to complete before the deadline.
Delays are holding up homebuyers as a post-lockdown surge in demand, fuelled in part by the temporary stamp duty holiday, has placed extra pressure on conveyancing solicitors, mortgage lenders and surveyors to push through purchases.
Data this week from TwentyCi found that it is currently taking buyers an average of 160 days to go from agreeing a sale to moving in, an increase on 95 days last year.
The consumer intelligence firm estimates that 325,000 buyers with sales agreed between September and January may fail to complete before the end of the stamp duty holiday on 31 March.
Aside from the disappointment that missing out will cause many purchasers, the ‘real concern’ is the economic cost if these home moves do not go through, according to TwentyCi.
The company expects a number of purchasers to pull out of sales, which could jeopardise other sales in a chain. It estimates the UK would miss out on £4bn of economic activity as a consequence.
Nisha Vaidya, mortgage expert at Bankrate UK, said: “Like the rest of the economy, the pandemic is continuing to cause major disruption to the housing market – hence these big delays in completing property deals.
“Each transaction is different, but we know that the record spike in house prices this year, combined with the stricter lending criteria introduced by mortgage providers are common factors that have complicated many deals and led to delays.
“For those home buyers keen to complete before the stamp duty holiday ends, the months ahead could be challenging.”
Earlier this month, the Society of Licensed Conveyancers (SLC), the Bold Legal Group (BLG) and the Conveyancing Association (CA) issued a joint statement requesting that the existing stamp duty holiday is “extended to avoid further disappointment in the spring”.
With lenders and conveyancers under increasing pressure due to high demand from buyers, all three conveyancing organisations are asking clients “and their estate agents” to take on board and understand “that transactions are going to take longer than usual to progress”.