As memories of strict lockdown measures fade into the past, the end of the stamp duty land tax holiday continues to make waves within the property and finance industries, especially as it returns to original rates on 1st October 2021.

The stamp duty holiday, which was introduced in 2020 to help boost the property market in the wake of the Covid-19 pandemic, did just that – with Bank of England figures revealing that, in the first quarter of 2021, the value of gross mortgage advances was 26.5% higher than the previous year.

Naturally, it’s easy to assume that the end of the SDLT holiday could result in a swift drop in property and finance demand, but how is it really making an impact on the industry?

The SDLT holiday’s impact on the property industry

According to figures published by the Nationwide Building Society, annual house price growth rose to 13.4% in June this year. This is shown to be the strongest growth since 2004, indicating that the SDLT holiday’s impact on the property industry has been particularly significant.

This rush to purchase property before the deadline at the end of June resulted in an increase in demand, pushing house prices up further as buyers and investors raced to complete their purchases.

However, the expected sudden drop in property purchases after the end of the SDLT holiday didn’t come to fruition, with many buyers still finding properties they wish to purchase. Even still, it is still predicted that house prices will continue to rise, as properties remain in shorter supply.

How has the SDLT holiday impacted bridging finance?

Not only has the SDLT holiday impacted the property market as a whole by boosting demand, but it has also had an impact on the lending sector, with a 12.2% increase in the number of first charge bridging loans being taken out during quarter two of this year.

Despite SDLT rates returning to their pre-covid rates, it’s predicted that this rate of lending is likely to increase as the year progresses as it may create more opportunities for property investors, and therefore, lending to increase.

What does this mean going forward?

As predictions for property demand continue to remain positive following the end of the SDLT holiday, the UK is entering into a new stage of post-pandemic life. The property market will need to respond to the changing needs of buyers and renters over the next year, including the boost in staycations, holiday homes and demand for home office space.

If you’re a property investor or developer looking for finance to help support your next purchase, we’re a bridging finance broker that can help you source a solution within your desired time frame. Not only this, but we can support you in finding semi-commercial mortgages and development finance to help ensure success in your next venture.

To find out more about how our commercial bridging specialists can support you, speak to a member of our team by calling 0121 309 0444 or email enquiries@finance-4-business.co.uk.