Buyers waiting for budget announcement

21 Feb 2021

This week in five seconds

Offers slowing down as buyers wait for budget announcement on March 3rd
Possible announcements include:

Stamp duty holiday extension
Increase in capital gains tax impacting buy-to-let investors
One-off wealth tax
Inheritance tax or income tax reform

Mortgage offers coming in more quickly now than last year with banks doing desktop valuations based on recent sales
Searches coming back more quickly now allowing faster sales progression

Offers slowing down

Activity in the sales market has been fairly similar to what we have noticed recent weeks with no major, noticeable changes. We have seen a decline in offers as some buyers are expressing to agents that they are waiting to see what announcements are made that may affect the purchase property in The Budget on the 3rd March. Agents are noticing that this is resulting in a lack of commitment from some buyers to progress with purchases in advance of this.

If you are looking to list your property and aren’t under time constraints we would recommend you get everything lined up, ready to list, but to hold off until the end of the first week in March. The agent you chose can still show your property to prospective buyers without having it listed online.

Possible budget announcements

These are all rumoured, however the uncertainty is causing some buyers to pause and wait.

Stamp duty holiday extension of six weeks has been rumoured by the Telegraph
Increase in capital gains tax would be expected to negatively impact liquidity in the buy-to-let market. There is speculation that a hike in capital gains tax rates could take immediate effect. If it is phased in gradually, some landlords and investors may sell up before the changes come into effect.
One-off wealth tax. The Wealth Tax Commission proposed a tax for individuals with assets worth over £500,000, or £1m for a married couple.
Inheritance tax or income tax reform

Mortgage offers coming in more quickly

We are continuing to see formal mortgage offers coming through from lenders far more quickly than they were last year. Many offers are being issued on a desktop basis without a surveyor physically viewing the property. Brokers have commented that this is due to a decent level of comparables that surveyors can draw on from the high volume of sales that have been agreed as well as those that have exchanged.

Searches coming back quickly helping sales progression

Searches, in most areas are coming back to solicitors far more quickly and this in combination with the lenders efficiency is resulting in sales progressing towards exchange far more quickly. If you are selling a property, there is significant paperwork that needs to be completed by you so do make sure this is done and available to your solicitor. It is always advisable to keep a sale moving forward as quickly as possible.

Have a great week.