UP to 200,000 people risk missing out on stamp duty savings worth as much as £15,000 due to lenders struggling with demand, experts have warned.
The temporary tax relief, along with the easing of lockdown restrictions, has seen house prices boom this summer as property buyers race to move home.
Stamp duty relief could cause delays in property transactions, experts say
The stamp duty holiday was introduced by Chancellor Rishi Sunak as part of his “mini-Budget” with the relief due to end on March 31.
But experts fear the pent-up demand caused by the saving could create backlogs in the property market, according to The Telegraph.
If buyers can’t net the stamp duty relief, analysts say it could then cause them to pull out of sales.
Property firms, who weren’t named by the newspaper, say as many as 200,000 people could miss out on the tax saving.
It comes as experts from Rightmove told HOAR that 40% more sales currently going through the buying and selling process now.
But they said there is still a chance for property buyers or movers to secure the stamp duty relief before Christmas if the sale is straight-forward.
Tim Bannister, head of property data, said: “We’ve heard from conveyancers that the congestion means some sales that would usually taking three months are taking around four months.
“There is still a chance to get through before the stamp duty deadline though if you can find a buyer or get an offer accepted before Christmas, as long as you make sure when the ball is in your court for anything that you respond quickly.”
Director of Benham and Reeves, Marc von Grundherr, also warned about delays in the property market.
He said: “This huge level of demand has somewhat overwhelmed the industry, particularly at the back end legal stage of a transaction.
“As a result, while the time it’s taking to have an offer accepted has been incredibly quick for most, buyers are seeing the process drag on for far longer than usual before their sale actually completes.”
Property values have jumped in recent months, with recent data from Halifax showing prices rose in September at their fastest rate in more than four years.
House prices were 7.3% higher than the same month last year, a rate of growth not seen since June 2016.
They were also 1.6% higher than August as the property market continued to bounce back from the impact of coronavirus and monthly house prices jumped 1.6% in July and 1.7% in August.
The average house is now £249,870, an increase of nearly £4,000 on the previous month.
But experts fear prices are could fall by nearly 14% next year as the stamp duty holiday come to an end.
A spokesman for the Treasury said: “The temporary stamp duty cut is helping to protect hundreds of thousands of jobs which rely on the property market by stimulating economic activity.
“Its time limited nature is what has encouraged people to take advantage of the scheme.”
Many first-time buyers have struggled to land a mortgage after banks pulled many of the deals designed for those with a smaller deposit.
But Prime Minister Boris Johnson has announced plans to help first-time buyers on to the property ladder with a new 5% deposit scheme.
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