Now,in light of the potential slow-down in the market caused by COVID-19, two industry bodies have asked for a review. The Royal Institute for Chartered Surveyors (RICS) was the first to ask the government for a stamp duty holiday once the lockdown ends. The National Federation of Builders (NFB) has since backed this up.The request follows the latest RICS predictions. They show a large net balance of its members believe house prices could fall over the next 12 months. One of the major influencing factors in this is transaction numbers. As less people are inclined to buy at a high price due to lack of confidence, sellers are pushed to reduce their prices.
Hew Edgar, head of government relations at RICS, thinks an intervention is necessary.
“Rics is not an organisation that would call for a stamp duty holiday on a whim. As we start to emerge from this crisis, however, it is likely that the finances of potential homebuyers will be under strain, and the burden of stamp duty could put buyers off
Boosting new-build sales
Some housebuilding is continuing through the lockdown. The government has not ordered sites to close down unless workers are unable to follow social distancing rules. It is also supporting house moves if they have already started, or if the property is empty. This applies to the majority of new-build sales.
However, builders are also calling for a stamp duty holiday to encourage sales once the current activity slows down.The government has taken a number of emergency measures to help people and businesses during the pandemic. For example, mortgage holders can take a three-month payment holiday, including landlords.
Financial support packages and loans are also helping thousands of businesses across the UK. Many employers have “furloughed” their staff until further notice, which is another government-backed scheme. While the housing industry could also feel the effects of coronavirus, it remains to be seen what support will be offered by the government.