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Stamp duty holiday extension


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HOLA441
1 hour ago, sammersmith said:

This stamp duty holiday enabled the asset rich(ish) but cash poor the opportunity to move that they wouldn't have had otherwise. The trouble is i suspect the gov didn't realise how many fall into this category and how much demand this would create. 

Mortgaging way over the odds to avoid a few thousand on stamp duty seems madness to someone with savings, but if you're the kind of person that would never have that few thousand in your hand then it does kind of explain the boom and also the need to pull out if they miss the deadline. 

I haven’t really worked that out but it’s mentioned over and over on these threads so I am sure it’s right. Ie stamp duty being paid helps those with lower deposits and effectively helps leveraging  

To me, it’s seemed (wrongly) like offering 2 or 3% off a sofa and suddenly people paying 10% more to get the new cheap sofa.

As with all leveraging…it’s great for a short term kick but once removed so it the effect.

In our town I am starting to see a shift in sentiment but to say things are ‘cooling’ is still a little premature.

The difference is I have seen a few ‘bargains’ come on and be sold immediately ie those asking pre Covid prices….I know the EAs fairly well and one confirmed that some people (normally investors) want to sell something quickly in anticipation of potential falls to come…so they are pitching below other stuff which is creating a softer market overall. But only slightly softer and the odd glamorous property still sells for a bewildering premium.

I am waiting for some the stories next week about chains falling through. 

 

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HOLA442
On 6/16/2021 at 2:23 PM, Timm said:

it's going to be absolute carnage.

1. Lots of purchases have been brought forward from the future. Those people won't be buying again soon.

2. Lots of chains are going to fall through - 50,000 is felt to be a conservative estimate.

3. Lots of potential buyers are going to find that not only has their deposit just reduced, so has the amount they can borrow.

4. Some chains will be held together after the deadline by everyone reducing their price a bit. This will show up in the stats. 

We are talking market meltdown here. More importantly, Sunak would never be PM. For this reason, I would not be at all surprised by a last minute U-turn for established chains.

It's a week away from the deadline. I haven't seen properties coming back on the market. I struggle to believe that if this was the case there wouldn't have been chains falling through already as people must have realised they won't make it by now.

If the chains fall through the buyers still exist don't they?

Also while the market is cooling properties are still going under off way above last year.
 

The whole thing is so far propped up as a ponzi that much of this has been driven by equity release:

https://www.dailymail.co.uk/money/markets/article-9713523/Grandparents-use-wealth-homes-1m-day-family.html

So if the thing falls the thing falls hard and we have bank collapses etc. So we are either going to get a 2008 style printing or we are going to get a complete collapse of our system.

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HOLA443
5 minutes ago, sta100 said:

It's a week away from the deadline. I haven't seen properties coming back on the market. I struggle to believe that if this was the case there wouldn't have been chains falling through already as people must have realised they won't make it by now.

If the chains fall through the buyers still exist don't they?

Also while the market is cooling properties are still going under off way above last year.
 

The whole thing is so far propped up as a ponzi that much of this has been driven by equity release:

https://www.dailymail.co.uk/money/markets/article-9713523/Grandparents-use-wealth-homes-1m-day-family.html

So if the thing falls the thing falls hard and we have bank collapses etc. So we are either going to get a 2008 style printing or we are going to get a complete collapse of our system.

So you can add the bank of gran and grandad to the bank of mum and dad and both can act as guarantor for the lender who only needs a 5% deposit for the grandchildren/children to get on that ladder.  What could possibly go wrong if everything is going up?

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HOLA444
8 hours ago, coypondboy said:

So you can add the bank of gran and grandad to the bank of mum and dad and both can act as guarantor for the lender who only needs a 5% deposit for the grandchildren/children to get on that ladder.  What could possibly go wrong if everything is going up?

The question is how far it goes before the rug gets pulled, could be now, could be a decade. Whatever happens there is no happy ending for anyone.

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HOLA445
9 hours ago, sta100 said:

It's a week away from the deadline. I haven't seen properties coming back on the market

I saw 2 yesterday.

I tweeted them on housepricemania twitter feed.  Both back on from Sale in Nov 2020, both increased in price when relisted

 

 

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HOLA446
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HOLA447
3 hours ago, TheCountOfNowhere said:

I saw 2 yesterday.

I tweeted them on housepricemania twitter feed.  Both back on from Sale in Nov 2020, both increased in price when relisted

 

 

Nice finds.

Whilst all increases seem daft I understand the sentiment from a seller tactic. If a buyer starts to back out or have doubts and ask for a discount then relist for a bigger price…then maybe sucker them back into the deal at the original price.😉

Obviously a ploy that can go spectacularly wrong 😆😆 

Edited by Pop321
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HOLA448
4 hours ago, Pop321 said:

Nice finds.

Whilst all increases seem daft I understand the sentiment from a seller tactic. If a buyer starts to back out or have doubts and ask for a discount then relist for a bigger price…then maybe sucker them back into the deal at the original price.😉

Obviously a ploy that can go spectacularly wrong 😆😆 

Let's face it. EA are ****s

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HOLA449
19 hours ago, coypondboy said:

So you can add the bank of gran and grandad to the bank of mum and dad and both can act as guarantor for the lender who only needs a 5% deposit for the grandchildren/children to get on that ladder.  What could possibly go wrong if everything is going up?

People in Japan are still paying almost multi-generational mortgages for tiny apartments built and bought a very long way from where they really needed to be. Some still cant sell for what they paid for them 30+ years ago.  Many had bought in desperation in order to get in before it was too late and the banks gave them more favour if they did have kids because at some point in the future the kids might have to pay the banks off. 

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HOLA4410

I agree some properties are coming back to the market either at the same or higher higher price bands. However, with one week to go for the June 30 deadline, I am yet to see a flurry of breakages of chains compared to normal times. May be we will see more as days go by. Else, it will further support the notion that there is a genuine surpassing of demand over supply and therefore, the prices will continue to be maintained even after SD Holiday ends. 

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HOLA4411
11 minutes ago, Marshall211 said:

I agree some properties are coming back to the market either at the same or higher higher price bands. However, with one week to go for the June 30 deadline, I am yet to see a flurry of breakages of chains compared to normal times. May be we will see more as days go by. Else, it will further support the notion that there is a genuine surpassing of demand over supply and therefore, the prices will continue to be maintained even after SD Holiday ends. 

The chains are supported at the bottom, not the top.

maybe all the sales will be down 12 weeks from now.

One thing for sure, if you want to sell to take advantage of the stamp duty cut it's already too late.

Sunak's created an almighty hole and the only people filling it will be lloyds bank.

Lets see how that goes down with young voters who must surely be getting to an age they are sick of these ****s.

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HOLA4412
18 minutes ago, Marshall211 said:

, I am yet to see a flurry of breakages of chains compared to normal times. 

That may be because the solicitors and mortgage companies are way way too busy to stop for a second and even say 'this transaction won't go through now'. They'll only get the time to clean up those loose ends in the aftermath, next week or thereabouts. That's my view anyway.

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HOLA4413

Anyone breaking a chain now also might find it difficult to get the 'consolation prize' of the September tapering deadline. 

I am not seeing many 'unexpectedly back on the market' types of listings any more than usual. If there were large amounts of breaking chains I'd expect it to be noticeable as it'll involve multiple properties.

My view is that those threatening chain breakages were just exaggerating in order to provide some kind of juicy story to the press to try and get the deadline extended. A bit like 3m people being trapped by cladding etc. I would think the majority of chains missing the deadline either will complete anyway or just negotiate something between themselves.

MSE or mumsnet forums might be good barometers but I don't think there are that many threads about it.

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HOLA4414
30 minutes ago, TheCountOfNowhere said:

The chains are supported at the bottom, not the top.

maybe all the sales will be down 12 weeks from now.

One thing for sure, if you want to sell to take advantage of the stamp duty cut it's already too late.

Sunak's created an almighty hole and the only people filling it will be lloyds bank.

Lets see how that goes down with young voters who must surely be getting to an age they are sick of these ****s.

 

Rishi Sunak applies for planning permission to build a swiming pool and tennis court at his Grade II listed Yorkshire manor house.

Levelling up.

https://www.yorkshirepost.co.uk/news/politics/rishi-sunak-applies-for-permission-to-build-swimming-pool-and-tennis-court-at-yorkshire-home-3284385

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HOLA4415
22 minutes ago, simon2 said:

MSE or mumsnet forums might be good barometers but I don't think there are that many threads about it.

There are plenty of 'threatening to pull out / ask seller to pay stamp duty' threads on MSE and Mumsnet but, at the moment, very few seem to have followed through with this threat.

However, the stamp duty holiday isn't over yet and most still seem to think Rishi will intervene at the last moment to save them. I understand why they think that (he has form) but it's a bit late for that now. My suspicion is that the hope of a further stamp duty holiday extension has to be properly extinguished before you'll see significant numbers of failing chains. 

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HOLA4416
3 hours ago, sammersmith said:

There are plenty of 'threatening to pull out / ask seller to pay stamp duty' threads on MSE and Mumsnet but, at the moment, very few seem to have followed through with this threat.

However, the stamp duty holiday isn't over yet and most still seem to think Rishi will intervene at the last moment to save them. I understand why they think that (he has form) but it's a bit late for that now. My suspicion is that the hope of a further stamp duty holiday extension has to be properly extinguished before you'll see significant numbers of failing chains. 

Why would they when they can become rich by borrowing...

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HOLA4417
6 minutes ago, TheCountOfNowhere said:

Why would they when they can become rich by borrowing...

Paying stamp duty requires cold hard cash, which most people seem to have very little available to hand. They might be able to get a loan / credit card to pay off the stamp duty but as i understand it, you're required to demonstrate how the stamp duty will be paid before exchange. 

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HOLA4418
11 hours ago, Si1 said:

That may be because the solicitors and mortgage companies are way way too busy to stop for a second and even say 'this transaction won't go through now'. They'll only get the time to clean up those loose ends in the aftermath, next week or thereabouts. That's my view anyway.

This seems plausible based on my experience. I've just finalised my sale (exchanged yesterday, completing on 30th). I was postponing exchange for a while, as I hadn't yet found somewhere to rent, but this week I was being warned that solicitors were very busy, so if I left it a few days we might not be able to complete in time.

Also, the solicitor I used for the purchase told me (back in April) he was too busy to take on additional work.

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HOLA4419
On 6/24/2021 at 9:51 AM, Marshall211 said:

I agree some properties are coming back to the market either at the same or higher higher price bands. However, with one week to go for the June 30 deadline, I am yet to see a flurry of breakages of chains compared to normal times. May be we will see more as days go by. Else, it will further support the notion that there is a genuine surpassing of demand over supply and therefore, the prices will continue to be maintained even after SD Holiday ends. 

Concur

Also things are still going under offer fairly quickly, so I don't think the stamp duty ending is going to have much of an impact.

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HOLA4420
59 minutes ago, sta100 said:

Concur

Also things are still going under offer fairly quickly,

I don't think these two statements actually logically follow?

59 minutes ago, sta100 said:

 

so I don't think the stamp duty ending is going to have much of an impact.

 

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HOLA4421
9 hours ago, Si1 said:

I don't think these two statements actually logically follow?

 

How come? Not much breakage of chains, market hasn't slowed much, so why does this mean the end of the stamp duty holiday will have much of an impact?

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HOLA4422
10 hours ago, sta100 said:

How come? Not much breakage of chains, market hasn't slowed much, so why does this mean the end of the stamp duty holiday will have much of an impact?

it doesn't mean anything either way because they are unconnected

you're confusing absence of evidence with evidence of absence, a classic logical error tbf which I must have done hundreds of times myself

Edited by Si1
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HOLA4423
On 6/24/2021 at 9:51 AM, Marshall211 said:

I agree some properties are coming back to the market either at the same or higher higher price bands. However, with one week to go for the June 30 deadline, I am yet to see a flurry of breakages of chains compared to normal times. May be we will see more as days go by. Else, it will further support the notion that there is a genuine surpassing of demand over supply and therefore, the prices will continue to be maintained even after SD Holiday ends. 

It has been 5 days since SD holiday June deadline ended and as I previously mentioned I have not seen a significant uptick in failed sales. What is coming back is not different from what I see on a regular basis, at least in SE London / SW London area for houses (not flats). I am not sure what others are noticing in their areas of interest. 

While anecdotal, the experience just reinforces my belief that the prices are not coming down anytime soon. As much as I would like a correction I just do not see the signs even after the major milestone of SD Holiday ending. 

 

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HOLA4424

Not seeing a mass re-listing of properties either where I am, not anymore than usual.

Still early days, and of course if one supposedly needed the SD discount in order to afford a move, there would be no point in re-listing, so you'd take it off altogether.

Here is a mumsnet thread with only a few replies, maybe it'll get some more traction in the weeks ahead: https://www.mumsnet.com/Talk/property/4288202-For-those-who-missed-30th-June-what-happened-next-Are-you-proceeding

My own suspicions is that most people were pretending to be broke, which was amplified by the media in order to try and put some pressure on extending the thing. Thus I would only expect a minority of replies in that mumsnet thread to be adverse.

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