The impending stamp duty cliff-edge

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The recent Budget has officially marked April 2025 as the end of the stamp duty exemption for first-time buyers on properties up to £425,000 – a measure introduced during Liz Truss’s tenure, our CEO Nick delves further into this below.

For the property sector, this deadline poses yet another tax-driven deadline that could disrupt the housing market and strain conveyancing professionals.

This situation is uncomfortably familiar. The 2020 Stamp Duty Holiday, which offered relief on properties up to £500,000 for all buyers, set off a frenzy that affected every part of the market. Conveyancers, mortgage brokers, underwriters, and other professionals shouldered an overwhelming surge in demand. This led to processing delays, heightened stress, and ultimately, a mass exodus of seasoned conveyancers. With many still carrying the scars from that period. The impending 2025 cut-off for first-time buyer relief risks recreating similar conditions.

The looming deadline will likely drive a rush of first-time buyers aiming to complete purchases within the current tax-relief threshold. Conveyancers – who were among the hardest hit during the 2020 Stamp Duty Holiday – could again find themselves at the centre of intense demand. During 2020-21, conveyancing firms faced a backlog of transactions, leading to delays that extended well beyond the expected processing times. These bottlenecks caused delays in property ownership registrations at the Land Registry and left buyers, sellers, and conveyancers alike navigating an exceptionally high-stress period.

In 2025, if no intervention occurs, conveyancers may face unmanageable workloads, extended hours, and increased risk of burnout. This new ‘cliff-edge’ could cause even more conveyancers to leave the profession.

For the broader market, delays in conveyancing and mortgage approvals could leave buyers unable to complete transactions within their desired timeframes, potentially missing out on the tax relief altogether. We know from 2020 that clients facing tax-related deadlines become understandably anxious, and the heightened sense of urgency can add further pressure on the conveyancers trying to handle an already overwhelming caseload.

The race to meet the 2025 deadline could also drive a surge in property prices, as first-time buyers compete to secure homes within the stamp duty threshold. Combined with a shortage of affordable housing, this could result in inflated values that exceed the relief cap, reducing housing affordability, particularly in high-demand areas, and undermining the goal of supporting first-time buyers.

Simply put, we cannot afford another scenario where conveyancers and property professionals are pushed to breaking point. To avoid a repeat of 2020’s challenges, we need proactive measures from both the government and the property sector.

  1. Phased stamp duty reductions: Introducing a phased approach to end the exemption, rather than an abrupt cut-off, would help smooth out demand. By distributing transactions over a longer period, the government could ease the load on conveyancers and other industry professionals.
  2. Increased support for conveyancers: One of the lasting lessons from the last surge is that we must accelerate digital transformation across the industry. The adoption of online case management tools, e-signatures, and digital property search systems have gone a long way in streamlining processes and reducing administrative workloads for our conveyancers.
  3. Digital solutions and automation: Accelerating digital transformation is always one of our key areas of focus and investment, innovations like this across the sector would make a marked difference. Online case management, e-signatures, and digital property search systems streamline processes, reducing administrative loads for conveyancers and helping the industry manage peak periods more efficiently.

As we approach 2025, it’s essential to apply the lessons of the past. The property sector has shown its resilience, but it requires foresight and strategic planning to navigate this new challenge. Conveyancers, in particular, are invaluable in supporting buyers and sellers through complex transactions, and they need protection and support as this deadline draws closer. By working together, we can prevent a repeat of the challenges seen in 2020.

Our message to the government is clear: let’s work together to prevent another stamp duty cliff-edge.

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