The impact of the stamp duty holiday is being credited by HMRC as the reason behind this surge in stamp duty land tax (SDLT) in Q4.

Its figures show transactions between October and December were 43% higher than between July and September and 14% higher than in Q4 2019.

What’s more residential property transactions in Q4 of 2020 were 44% higher than Q3 and 16% higher than in Q4 of 2019.

Residential properties made up over 92% of all SDLT transactions in Q4. And, due to the stamp duty holiday, residential transactions which were ‘non-liable’ for SDLT went up by 127% when compared to Q4 of 2019 as many properties – those under £500,000 – became completely exempt from the tax.

Key role for brokers

Vikki Jefferies, proposition director at PRIMIS Mortgage Network said: described these numbers as ‘healthy’ and paid tribute to the work of everyone involved in processing these transactions.

“Over recent months, lenders and advisers have been working hard to process these cases and help borrowers benefit from the stamp duty holiday ahead of the March deadline, all while continuing to work remotely – something which has been no mean feat,” she said.

“Going forward, all eyes will be on the March Budget to see if an extension to the stamp duty holiday is announced.

“In the meantime, brokers will continue to play a key role in helping borrowers find the best product to meet their particular needs.

“For this reason, it will be up to lenders, distributors, conveyancers, trade bodies and other key players in the mortgage market to ensure that advisers have the resources and capacity they need to support their clients during this period, regardless of whether the stamp duty holiday is extended or not.

Cliff edge

Nick Leeming, chairman of Jackson-Stops, estate agency, said: “With transactions in Q4 2020 16% higher than the same time last year, and the numbers of buyers exempt from SDLT exempt up by a huge 127%, today’s data demonstrates how the government’s SDLT holiday, alongside a huge shift in lifestyle aspirations, has contributed to the active property market we have seen since the summer.

“As highlighted by members of parliament this week, what we must avoid now, for the property sector and the wider economy, is a cliff edge where all economic support suddenly drops away, especially as we have not yet seen the full economic impact of the virus.”

He added: “Today’s figures clearly show the positive impact the SDLT holiday has had for the property sector and the UK economy since its introduction. I would therefore urge the Government to consider a more gradual approach to paring back SDLT relief.

“Doing so will allow transactions to complete as planned in an orderly manner, giving buyers the security they need and ensuring the property market and other interconnected sectors of the economy don’t suffer a sharp shock during one of the most challenging and uncertain periods of the pandemic.”