THE WOKINGHAM property market has been “frenzied” as buyers rushed to make the most of the tax holiday, two of the town’s estate agents have said.
Last week, the Government’s stamp duty holiday entered its next phase — a move which both David Cliff Estate Agents and Hat and Home said should stabilise house prices in the area.
Introduced in June last year in a bid to boost the property market following the first lockdown, the stamp duty holiday stopped buyers paying tax on the first £500,000 of their purchase, saving up to £15,000 on the price of their new home.
But from Thursday, July 1, the Government started winding back its support to phase out the tax holiday from October.
“There was, without a doubt, this frenzy as far as the market’s concerned,” David Cliff, of David Cliff Estate Agents, said.
According to the agent, the tax holiday combined with people saving money from not going away created the ‘perfect storm’ for spending.
“All of a sudden, most people had more money in their pockets,” he said.
“Wokingham is an affluent area, and I think people felt they wanted to do something and be proactive, so made the most of the savings.”
This has been echoed by Ben Gee, founder of new agency Hat and Home, who added: “The demand was absolutely exceptional.
“The extension of the stamp duty holiday from the end of March to June brought a bunch of fresh new customers to the market. People came out in droves.”
According to the two Wokingham agents, the tax holiday also prompted property prices to skyrocket in the area as supply failed to keep up with demand.
“There weren’t enough properties available,” Mr Gee said. “There was so much competition among buyers and prices increased.”
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Mr Cliff said this made it a great time for sellers. “Most properties had multiple people interested,” he added. “We saw between two and seven offers on most properties, so we could choose who to sell to.”
As the stamp duty holiday came to an end last month, the duo said their teams were working around the clock to sign off as many purchases as they could.
However, the support has not ended yet. From now until Thursday, September 30, buyers must start paying stamp duty above £250,000.
And from Friday, October 1, the Government will end the tax holiday completely and bring rates back to normal, meaning only the first £125,000 of a property purchase is tax-free.
Both Mr Cliff and Mr Gee said they are not anticipating anywhere near as much demand in this next phase of the scheme.
“The fact that the saving in most cases will be £2,500, rather than £15,000, means it’s not enough to fuel a rise in demand like we saw before,” Mr Gee explained.
“However, demand in Wokingham is still huge and supply is still low, so I expect we’ll see prices remain strong for the rest of the year.”
Mr Cliff added: “There’s less property coming onto the market than we normally expect.
“There’s a lack of stock, but we are still selling and we don’t see any reason for prices to change.”
The Government has also introduced measures to support first-time buyers, including scrapping stamp duty on the first £300,000 of purchases and launching a 95% mortgage scheme.
The two agents said this prompted lots of younger people to get on the property ladder this year, too.
