Rightmove sees busiest January on record ahead of stamp duty deadline

Friday, 5th February 2021, 12:01 am
Updated Friday, 5th February 2021, 8:59 am
Online estate agent Rightmove said the number of sales agreed in January was up 5 per cent year-on-year. (Picture: Getty)

Property website Rightmove says the housing market is in a strong position after it enjoyed its busiest January on record.

It said it showed new buyers were undeterred by stamp duty holiday ending, despite concerns the housing market could collapse when the holiday ends next month.

Chancellor Rishi Sunak announced the holiday last summer, raising the threshold for stamp duty on house purchases from £125,000 to £500,000 - meaning anyone buying a home for £500,000 or less would not have to pay any of the tax.

However, the holiday runs out on March 31 and the Government's stamp duty calculator shows someone purchasing a house for £500,000 would face a bill for £15,000 if they fail to complete by the deadline, sparking fears sales could fall through.

Falling through

However, Rightmove said its figures suggested the fears were unfounded with January 2021 site visits up by 39 per cent on January 2020, to more than 211 million - although Tim Bannister, Rightmove property data director, said he had started "to see fall throughs creep up a bit, though not by a substantial amount".

A Rightmove spokesman said: "The proportion of property sales that fell through in January was 7 per cent higher than in January last year.

"This could be an early sign of some of those deals falling through because buyers and sellers now realise they won’t have time to meet the looming stamp duty holiday deadline."

Rightmove said the number of prospective buyers contacting estate agents was up by 7 per cent on January last year, and those enquiring about a property to rent was up by 14 per cent.

And it said the number of sales agreed in January was up 5 per cent year-on-year, despite the fact the majority will not complete before the stamp duty holiday deadline.

However, it did say new listings for sale are down by 21 per cent, which it suggested was "likely driven by challenges such as homeschooling, which may be delaying some people thinking about moving and preparing a home to sell".

New listings for sale are down by 21 per cent. (Picture: Getty)

Effect of lockdown

Mr Bannister said: “It’s clear more people than ever before used the new year as a chance to start thinking about moving home, despite all of the challenges and worries that came with January, but we are seeing the effect of lockdown on the number of properties coming to market.

"I know first-hand how hard it is right now to juggle your work commitments with also trying to teach your children their times tables, so those looking to trade-up to a bigger home may find there isn’t as much choice as before in this sector of the market until children start going back to school.

"We’re starting to see fall throughs creep up a bit, though not by a substantial amount, a sign some deals may be falling apart as they know they won’t complete in time to make the stamp duty holiday deadline, though this is likely to be in the groups set to make more substantial savings.

"The start of February so far looks encouraging for activity, which points to some positive signs for the next few months.”