Stamp Duty rise causes last minute property completion rush

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Landlords, estate agents and solicitors were in a last-minute rush to complete property deals ahead of a stamp duty rise that takes effect to today.

 

Anyone buying a home that is not their main residence will face a 3% Stamp Duty surcharge from April 1st 2016

In Scotland, the equivalent tax - the Land and Buildings Transaction Tax (LBTT) - is also being up-rated.

From midnight on Thursday the duty on a property sold for £200,000 will rise from £1,500 to £7,500.

"It's been very chaotic" said Rob Hailstone, of the Bold Legal Group.

The problems have been compounded by the fact that some of the fine detail was only announced in the Budget just over two weeks ago.

"It's been ridiculously busy. Buyers have been saying they want to rush it through, because they don't want to pay the surcharge," said Mr Hailstone.

'Bottleneck'

Sales can only be completed when the money comes though from the lender.

"It's a busy crazy day," said Martyn Baum, the President of the National Association of Estate Agents.

"We've all got a bottleneck, and a huge amount of deals before the deadline. I've heard of estate agents and conveyancers staying open till 10pm, and then opening again at 5am this morning."

The stamp duty surcharge will affect landlords purchasing buy-to-let property, or anyone who is buying a second home.

But many ordinary buyers are involved in chains which involve an investor somewhere along the line - so they too have been caught in the chaos.

Earlier this week, the Bank of England announced plans to subject landlords to a series of new affordability tests 

Their personal income and expenditure could be scrutinised by lenders before they decide to give them a mortgage.

Landlords may also have to prove that they could afford a rise in borrowing costs.

 

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