Shares in estate agents soar since the Budget
The chancellor’s announcement last week of an extension of the stamp duty holiday until the end of June and a mortgage guarantee scheme starting in April have sent home-buyers into a frenzy.
The question facing investors in the UK’s listed estate agents and property services firms is whether the rising demand will be a short-term or long-term trend.
The stamp duty holiday on houses up to a value of £500,000 was due to expire on 31 March, but the government extended the scheme.
The exemption stays at £500,000 for transactions expected to complete by 30 June in England and Northern Ireland; it then falls to £250,000 for transactions expected to complete by 31 September, after which it reverts to the usual threshold of £125,000.
Meanwhile, the mortgage guarantee scheme allows buyers with a deposit of just 5% to buy houses up to a value of £600,000 with the government underwriting some of the losses if buyers default. According to Rightmove (RMV), 86% of the properties on its site have an asking price of £600,000 or less.
Rightmove experienced its busiest ever day on the day of the budget with site visits topping 9 million for residential properties as well as record searches for commercial property as firms look to expand. Estate agents also reported record enquiries as buyers rushed to take advantage ofthe new measures.