Published: 01/02/2021A cursory glance at any property market segment in a newspaper these days is enough to make anyone reach for the brandy. As the end date of the stamp duty holiday looms, more and more commentary is predicting impending catastrophe. It’s certainly true that there are challenges ahead, not least in Leeds, but challenges always go hand in hand with opportunities.
Stamp duty is very much top of the property agenda now. Even though the holiday comes to an end at the end of march, the lengthy process of conveyancing means any offers accepted now are unlikely to be completed before the deadline. The average property value of a home here is £317,000, so if a transaction happens after 31st of March 2021, the average stamp duty bill rises from nil to £5,826.
The true impact remains to be seen. While these additional charges are not inconsiderable, many people will perceive the property to still be worth buying, especially if they have emotionally connected to it. Mortgages remain historically cheap, and the quality of the mortgage deal often has a larger bearing on the cost of the property than stamp duty alone.
The government’s logic for not extending the stamp duty holiday, or even permanently reducing it, is unclear. For anyone working in residential property, the positive effects to the wider economy of high transaction rates are well known. Not only does it support the myriad industries inextricably intertwined with the house moving process, but it also supports a more geographically flexible workforce, which may be more important than ever post-covid.
Our experience suggests that Leeds is very well placed to weather any storm which may come over the horizon. Anyone who knows the area will understand why we’re so confident. Not only do we have a fantastic balance of people, jobs and housing stock in the local area, but we’ve got a proven track record of bouncing back. After the financial crisis of 2009, prices in some parts of the country took nearly a decade to recover, and sales levels never did. However, in our area the strong pull factors meant we were able to return to pre-credit crunch levels in less than half that time.
The market faces a number of challenges beyond stamp duty. However, one thing we’ve learned from the pandemic is that people now have a renewed interest in their home and how it affects their quality of life. At a time when huge parts of the economy have been untouched by lockdowns and mortgages remain available, we think the intrinsic attractiveness of the Leeds property market will shine through.
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