Gutted - stamp duty

[MrsJocelyn]

Found the perfect house and made an offer, on the condition that they would vacate before the end of March. The seller accepted our offer but won't guarantee to be out before the stamp duty holiday ends. We can't afford it after March. ☹️ Gutted and don't know what to do.

By the way, does anyone know of a calculator which shows what stamp duty will be after March 31st?

@WinstonmissesXmas I must have misunderstood. I thought you were still waiting on a date from an earlier post

"Friday, draft contracts shared between solicitors, survey next week and providing that’s fine, we’ll be looking to set an exchange date."

I still don't think how fast the process moves depends solely on the bank and solicitor.

@Bouledeneige - if you use the gov calculator and put the date after the Stamp Duty holiday that will tell you what you will pay. www.tax.service.gov.uk/calculate-stamp-duty-land-tax/#/intro

As a side topic, I do worry about houses being bought during the stamp duty holiday. House prices have increased at an astonishing rate during the holiday, particularly withhe added impact of pent up demand. There's evidence that the average house price has been inflated by more than the absolute maximum saving you could make (ie if you paid £500k). That makes the so called 'saving' an awful lot less and just about every prediction there is shows prices dropping back down sharply.

Some people who think they have nabbed a bargain will be owning homes worth less than they paid, even taking into account the reduced stamp duty.

Everything is taking so much longer at the moment. Searches are taking so much longer to come back. Solicitors have a much bigger workload than normal. Banks time scales for approving mortgages have increased.
It would be tight to move before end of March in normal circumstances. Unlikely in the current climate. Nothing to do with your buyer necessarily.

We've just exchanged (hurrah!!) and are in a short chain of two properties, but it's taken five months with no significant hiccups. Our mortgage offer alone took eight weeks to come back.

It seems unlikely OP, I have been waiting for my land searches for over 8 weeks now, the delays are horrendous at the moment even with uncomplicated chains. I don’t even have a chain as I am buying my late Mums house!

Thank you Figmentofimagination

Its really shit but I think it's unlikely to complete in that time frame now. You're relying on solicitors/banks/councils etc who are snowed under atm and won't prioritise your purchase just because you think it should be quick.

I'm not really sure what the petition to extend will achieve- there will be the same problem come the next deadline surely!

Best bet would be talk to the people involved. Are the vendors on board with rushing it through, would they go into rented if necessary? What are their plans- talk to your broker, for example s/he could use a lender that doesn't have the backlog of others, go for a product with no ERC and remortgage you to a more competitive product in a few months once you're in. Talk to the conveyancer you are using- whats their workload and realistic timescales like. These things vary all over the country so the people involved would have a much better idea than us all on mumsnet.

Where are you buying? Our mortgage offer was back within 48 hours and searches in a week.

We exchanged this week having had and accepted offers in August. Three house chain.

Fingers crossed the holiday is extended.

We are FTB and buying an empty house as vendors inherited another one. We offered mid November. Had mortgage offer back mid December. We are now mid Jan and searches all back and most enquiries between us and the vendor have been discussed (helped by the fact they gave us thier phone number so DH has chatted directly to them) so hopefully should exchange mid Feb at the latest.
So looking like 3 months maybe a little less and that was very straightforward and no chain.

I have a buyer for my house conditional to completing before end of March. I put an offer forward on the same condition. It appeared my vendor is elderly and shielding and anxious to go out to view properties (they are downsizing) therefore my chain has effectively collapsed.
Unless i find an alternative house without chain asap, I am willing to wait for my vendor to get ready, suck up the stamp duty and find a new buyer for my house as mine will not wait.

So sorry to hear that @oreo2020 it’s such a stressful process, we are in a chain of three, none of us requiring a mortgage & still taking an absolute age.

The problem with extended the stamp duty holiday is when do they stop it? They could extend for another 3 months but then at that point there will be people who haven’t exchanged in time so will ‘miss’ the no stamp duty, does the government then extend it another 3 months to placate those people and then another 3 months as there will be another new load of people trying to beat stamp duty dead line? Whenever it happens there will be winners and losers!!

It really seems hit and miss even in normal times, anyway. I’ve read a lot on this thread about six or eight weeks, which seems incredible to me - we just completed in end of Feb last year and it took close to six months! We were FTB and the flat was empty / landlord selling. I am still mystified about why it took so long because there were no issues with surveys or anything. Sometimes you just end up instructing a really slow solicitor for no good reason!

Came on here to search for a stamp duty thread...

Hearing very mixed messages (well, via google!) on whether the stamp duty holiday will be extended.

It will make a massive (£15k) difference to what we would have to pay on the properties we are considering.

It’s so hard to know what to do but the pre / post stamp duty holiday offers are an interesting angle.

What are the realistic chances of it being extended into the summer, do we think? Perhaps aligning with when we might be back to ‘normal’(ish) post covid. Certainly those time scales have moved back considerably since the SD holiday was first put in place.

With the obsession with complicated red tape in this country there is no way they could be out by March .
My mate should have had her house issues sorted last October , hasn't happened yet.

The vendors would have to agree to go into rented... or immediately find a chain free place of their own to complete on, unless they already have a second home to move to?

Would you need a mortgage? Surveys / valuations are taking a while in some places because if demand / surveyors and vendors having covid / the process taking longer because if Covid protocols.

OP how much are you gonna be on the hook for if you miss the stamp holiday cut off? Can you not borrow the extra from family?

It's gutting but it's impossible to guarantee a move in that time frame, so your seller is right. Best thing is to pull out and move on, forget about that property. Disappointing, yes, but there will be other houses you love.

Sorry to bring a downer to this, but if you’re buying a house that you couldn’t afford in normal times (with stamp duty), then can you actually afford it at all?

Not being able to find the little bit (relatively speaking) extra suggests to me that you’re already borrowing your max mortgage & putting all of your savings/equity into the purchase. Interest rates are at rock bottom at the moment, can you still afford it when they rise?

To all those asking if we can actually afford the house: yes. After paying all bills and mortgage we'd be left with enough to live on each month. However, post-March the stamp duty will cost us an extra £18K approx. This is money we have to fund straight up and I do not consider this a little amount. It is also money we had not initially factored in as we thought we'd have moved by now.

So if you have to pay around £18k stamp duty after deadline, that would mean the property that you intend to buy will be around £500k?! 18k isn't really alot on a half a million pound house, I would say that you have over leveraged yourself if you can't afford that if you have brought the house, you should have emergency savings available even after buying a property, it sounds like you may have been saved from making a bad financial decision in buying a house you cannot afford, also the seller probably won't be able to get what they were asking pre covid price for the house so you could probably re negotiate the stamp duty cost with them, they will lose out otherwise as well and you will 'save' by not having to get into as much debt as you would have of done by paying the stamp duty tax on it as house prices have risen by that much since being introduced.