Brokers who have not already done so are also being urged by both the Association of Mortgage Intermediaries and the Intermediary Mortgage Lenders Association to contact clients at risk of missing the reduced stamp duty cut-off, in order to prepare them for the worst-case scenario.
Ami chief executive Robert Sinclair said: “The end of any homebuyer incentive inevitably distorts the market for a period and results in disappointment for those who miss the cut-off point. Managing mortgage borrowers’ expectations is of primary importance at such times as these.”
“Brokers and lenders are working hard to complete on as many affected cases as possible before 1st April, but there will no doubt be many which don’t beat the deadline. While no-one wants to be the bearer of bad news, it is better to have a well-informed client prepared for potential higher buying costs than one who is both disappointed and surprised.”
Imla executive director Kate Davies commented: “Lenders are just as keen as brokers to ensure as many customers as possible can complete on their property transactions ahead of April 1st, but congestion at the conveyancing stage is a real issue, and some borrowers will bear the brunt of higher stamp duty as a result.”
She added: “Industrial action at the land registry will not help when it comes to transfer of title post-completion, particularly with those less routine cases which cannot be dealt with via an automated process. It is more important than ever that we keep the lines of communication open between lender, broker and borrower in the weeks ahead.”
Since September 2022, buyers of homes priced up to £250,000 have been exempt from paying the duty. But this will revert to previous levels from April, when stamp duty will be payable on homes priced above £125,000. The threshold has also been raised for first-time buyers since 2022, with no stamp duty payable on homes priced up to £425,000. That exemption also disappears from 1 April.
Following October’s Budget, which confirmed there would be no extension of these rules, there was an uptick in first-time buyer demand, exacerbating the inevitable bottleneck as April approaches.
With staff at the Land Registry currently threatening strike action from January 21st over the requirement to return to the office three days a week, there are also fears that delays to transfer of title could also be exacerbated.