If 2020 has taught us anything, however, it’s that we should always expect the unexpected, and the latest figures from HMRC certainly make for some interesting reading.
According to HMRC, there were 129,400 residential property transactions in December – up 13.1% from November, and 31.5% higher than in December 2019. When you consider where we were last spring and summer, that’s an astonishing turnaround.
This unseasonal demand for property is undoubtedly down to two factors. After virtually grinding to a halt earlier in the pandemic, there was always going to be pent-up demand in the market which is still working its way through the system. Then there was the introduction of the stamp duty holiday back in July which has played a huge part in house price growth surging to 7.6% over the year to November 2020, up from 5.9% in October 2020. The average property in the UK is now worth a record high of £250,000. This is the highest annual growth rate the UK has seen since June 2016.
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However, while the holiday has given the market a real boost, it’s in danger of becoming a victim of its own success, with warnings that some lenders are struggling to cope as the influx of applications has created a bottleneck.
So, what can brokers do if they’ve got customers who are struggling to sell an existing property and buy a new home before the holiday finishes at the end of March 2021? Buying and selling a property is stressful enough at the best of times, but it’s going to feel as though there’s even more at stake if there’s the potential to save up to £15,000 in stamp duty riding on it.
This is where specialist lenders like Precise Mortgages, who offer bridging finance, could provide the solution you’re looking for, particularly for those customers who are in a chain which has been broken or is about to break.
A bridging loan is not the solution for everyone, however, and this is where the experience of a skilled and knowledgeable broker comes to the fore. Making sure your customers get the best advice to suit their circumstances is crucial.
If you have a customer who’s looking for the freedom to proceed with their own purchase without having to depend on the rest of the chain completing first, it’s worth remembering that specialist lenders have options available to help them make the most of the stamp duty relief.
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