A big surge in completions ahead of new stamp duty rules on 1st April is expected, according to Lloyds Banking Group.
Lloyds expects to see completions for March 50% higher than usual. The Group, which includes Lloyds Bank, Halifax and Bank of Scotland, has been working with conveyancers and mortgage brokers to ensure they are ready for the rush of buyers trying to beat the deadline. The lender has guaranteed to process all completions submitted at least a week before the deadline.
Changes to stamp duty will affect first-time buyers and home movers, as the nil-rate threshold reduces from £250,000 to £125,000. This means that buyers will now pay a 2% tax on the part of the property value between £125,001 and £250,000, bringing thousands of homes into the stamp duty liability for the first time.
For first-time buyers, the tax-free threshold is being cut from £425,000 to £300,000, plus the maximum property value eligible for first-time buyer relief will drop from £625,000 to £500,000. This change will particularly affect those looking buy in areas like the South East and London, where property prices for first homes often exceed these thresholds.
A first-time buyer purchasing a property for £400,000 will have to pay £5,000 in stamp duty under the new rules. Similarly, home movers buying properties priced between £125,000 and £250,000, who previously paid no stamp duty, will now have to find up to £2,500 extra.
Lloyds has asked conveyancers to submit Certificates of Title as soon as possible, and no later than 25th March to beat the stamp duty deadline.
Amanda Bryden, head of Halifax Intermediaries & Scottish Widows Bank at Lloyds Banking Group, said: “With the new thresholds for Stamp Duty coming in just days, we are expecting a rush of customers trying to complete their purchase and avoid the extra cost. We’ve been working with mortgage brokers and solicitors to get ready for this, and we have seen evidence of many completing purchases early.
“We’ll do everything we can to get completions turned around before the Stamp Duty deadline if they come to us after 25th March, but there’s no guarantee. That’s why we are reminding conveyancers to get Certificates of Title to us no later than the 25th March, and sooner if they can, to be sure to beat the deadline.”
