It’s been another busy month for property investors, with the Green Homes Grant being extended by 12 months to the end of March 2022 and new proposals unveiled to extend the regulations around carbon monoxide alarms to include all rooms with fixed combustion appliances (including gas cookers).
I thought it would be interesting to share with you recently released data indicating that September saw a 13 year high in mortgage approvals – that’s the highest number of approvals since before the 2009 financial crisis!
This equates to a total of 91,500 mortgages being approved – an 8% increase on August’s total of 84,700. This is undoubtably due to the stamp duty holiday, however, potential delays in conveyancing caused by such a surge in demand could mean that, frustratingly, many buyers may miss out on the savings.
As well as conveyancing delays due to the volume in transactions, I know from speaking with investors that there are significant delays within the mortgage application process. Lenders are taking several days to respond and even withdrawing applications for products which are no longer available. There are also still only half the number of mortgage products available and those which are available tend to be at a higher rate.
Despite the barriers and delays around conveyancing and mortgage applications, when we look at current transactions, Land Registry data indicates that there have been 918 sales between July–September in Medway. I was recently speaking with local accountant, Peter, from Beresfords Accountants, and at an average stamp duty saving of £2,395 per property, Medway homeowners have saved around £2.2m so far.
Medway Homeowners have saved around
£2.2m in stamp duty since July!
We must wait to see if the Government take any action to compensate buyers that lose out on the stamp duty holiday through no fault of their own. A recent article I read highlighted that as many as 365,000 people across the UK could miss out on the saving and suggested that the Stamp Duty Cut was a costly mistake costing the economy an entirely avoidable £4bn.
It will be interesting to see how many homeowners this will affect in Medway and what the overall cost will be – I will certainly be running another article on this when data for the full year is available!
I fully expect that the first six months of 2021 will be challenging for the property market and I have recently read that analysts believe that the stamp duty holiday was a big mistake.
This leaves us with a few questions to consider: Will the stamp duty holiday be extended, or concessions be made for delays? Will we see a crash (or slump) in the first six months of 2021? How many will lose out on savings and cause sales to fall through? And, dare I ask, will there be a ‘Brexit effect’?
I will be keeping a close eye on this over the coming months and will certainly keep you posted with further developments!
If you are looking to invest in the Medway area, I am more than happy to give advice where you need it. You can either connect with me through LinkedIn or book a 15 minute consultation directly in my diary.