Property buyers are being forced to pay as much as £50,000 more than the asking price to purchase homes as the stamp duty holiday boosts the market.
One in eight properties is selling for more than the asking price, estate agents said, with many changing hands for significantly more than the listed price. The Government’s stamp duty tax holiday, which allows the vast majority of buyers to avoid paying tax until March 31 (this is significantly different with Land Transaction Tax in Wales), has supercharged the housing market as buyers look to save thousands of pounds on their purchases.
However, there are concerns that buyers are having to pay over the odds to secure the property in the first place. A report published by NAEA Propertymark, an estate agents’ trade body, found that 13 percent of homes sold for above the asking price during August.
That is the highest proportion recorded since November 2015 and is significantly higher than July 2020’s figure of 8 per cent.
Carol Peett of West Wales Property Finders, a buying agent, said that she had seen a £330,000 property in Pembrokeshire sell for £50,000 over the asking price. Another home, listed at £170,000, had sold for £20,000 more than anticipated. “The buying frenzy is completely absurd and has been going on since the market opened up after lockdown”, she said.
Mark Hayward of AEA Propertymark said that he had regularly seen homes changing hands for more than £5,000 above the listed price, particularly in high demand areas such as the South West and East Anglia. “Multiple competitive bidding on certain properties has resulted in the final agreed sale price being in excess of the asking price”, he said.
As well as the stamp duty tax break, a lack of properties on the market has also contributed to escalating house prices. The number of homes being offer by a typical estate agent branch has fallen from 43 to 40 between July and August.
The Daily Telegraph – 30th September 2020
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