Thu 08 Jul 2021
Overwhelmed solicitors have hiked fees in face of massive demand from property purchasers trying to take advantage of the stamp duty holiday. Jeremy Leaf, principal of Jeremy Leaf & Co, told The Daily Telegraph: ‘We’ve noticed some solicitors take advantage and over-price jobs.’ He explained further in The Times that different solicitors had quoted £2,500 and £6,500 for the same £1.27 million property sale. He had seen firms charging ‘literally anything. It’s a supply and demand issue, but there is a lack of transparency in the sector – and that’s what annoys people. If surveyors were to simply say they were putting a price premium in place until 30 June because of extra demand, we’d accept that. But very few have.'
The stamp duty holiday has created the busiest property market for a decade. Jeremy Leaf told the i: ‘[Saving on] stamp duty has been a particular catalyst. It’s been a good time to sell a perhaps not-very-sellable property.'
That said, UK house price growth slowed unexpectedly in April, according to the Office for National Statistics. However, Jeremy Leaf told The Financial Times that market activity was likely to continue at similar levels, with increasing sales resulting in ’some price softening rather than a correction’.
The Nationwide building society had a different take on the market in its house price index, which revealed that prices are growing at the fastest annual rate in 17 years, with no sign of any let up. Jeremy Leaf told The Guardian: ’On the ground, we know that many of the buyers agreeing sales were not able to take advantage [of the tax break] so there is still plenty of life remaining in the market, even though demand has moderated after the frenzy of the previous few months.’
The suburbs are experiencing a renaissance, thanks to post-pandemic life and work adjustments. Jeremy Leaf told The Times that he is starting to see people who fled central London last year to rent in the countryside ‘drifting back towards the outer suburbs for more permanent accommodation’ instead of heading to grittier postcodes.
Gazumping is also back, another sign that the market is overheating. Jeremy Leaf told Mail Online: ‘Gazumping is frequently raised as an issue when buyers are unable to purchase a property. However, we find that in most cases the fault lies with the buyers themselves for failing to exchange contracts within an agreed timescale perhaps or because they were unable to obtain mortgage finance or to arrange a survey in time. Of course, under the present arrangements there is very little to be done in terms of reimbursing those who are genuine victims of the practice. But the advantage of our present system is its flexibility, so that if buyers are unable to meet their obligations, it is relatively easy for alternatives to be found.