While the current stamp duty holiday has been extended in England until the end of June, developers should act now to prevent a downturn in sales come the summer.
The tax break, which was introduced in July 2020 due to the Covid crisis, has provided a real boost to the property market with movers motivated by the prospect of saving up to £15,000.
The current stamp duty exemption for homes worth up to £500,000 will end in England on 30th June 2021. Between 1st July – 30th September, this nil-rate band will be reduced to £250,000, and from 1st October, the original threshold of £125,000 will be reinstated.
While this tapered approach should avoid the “cliff edge” that was feared for the original deadline, experts predict the property market will still be impacted when these tax breaks are no longer available.
How to capitalise on the changing market
So, we know what is going to happen, but what can developers do now to prepare for the end of the stamp duty holiday? What impact will this have on the property market and how can you ensure steady sales despite this declining governmental support?
- An end to the chain: as the stamp duty holiday deadline draws nearer, movers will be keen to keep chains as short as possible to secure a completion. This is where new build developers offer a significant advantage as they provide an end to the chain. It is also likely there will be many movers whose chains have fallen through when the June and December deadlines arrive. This is a great time to highlight the speed at which completion is possible on a new build home, both through social channels and carefully targeted media outlets.
- Don’t forget digital: although we all hope people will be moving around more freely when the summer arrives, don’t forget the importance of your digital library. Whether people prefer to view homes online for time-saving benefits, to cut out travel or simply because they still feel it is safer, providing potential buyers with quick and compelling video tours and captivating content will continue to make a difference well into summer 2021 and beyond. Remember that your online assets are often the first thing a potential buyer will see, so ensure they are as bespoke, comprehensive, and representative as possible.
- Make people evangelical about your events: while face-to-face events might be hard to organise for a while, don’t rule out events – just make them virtual. At PHA we have run a host of virtual events throughout the pandemic and have many planned in beyond as people may still be cautious about face-to-face gatherings for some time. If you have creative content that is targeted correctly, they can be a powerful tool for getting your properties in front of the right people. From celebrity cook-a-longs in your showhouse kitchens, to VIP tours with interior designers’, virtual events open up a world of opportunities when it comes to selling homes.
- DIY “tax breaks”: while you may not be able to extend the government stamp duty holiday, if you have found this was really driving demand, why not create your own incentive that provides buyers with similar benefits? Consider a savings scheme with a strict deadline as this will help to maintain a sense of urgency and drive demand.
- Shout it from the rooftops: every brand should have a single-minded proposition. This is the one thing that sets you apart from the competition and makes movers want to purchase your property over one of your competitors. As the aftermath of the Covid crisis starts to settle, many people will still be in the market for a move after spending so long at home. Now is the time to make sure potential movers know why your property could be the home of their dreams. This is a great time to consider a publicity push to spread the word and keep your properties front of mind. You can find out more about how we utilised PR in the property sector to maximum effect by reading our case study for Purple Bricks.
If you would like to discuss any of the topics covered in this blog, please get in touch. As specialists in the property and construction sector, it’s likely we have been there before (and probably got the T-shirt.) Whether you are confused about your USP, unsure how to target potential customers in a changing marketing or simply want to make some noise for your brand, we would love to help.