When the stamp duty holiday ends: 3 data points solicitors need to know

In Business Support

As the SDLT holiday draws to a close, how can practices find and replace those customers they’re about to lose? We look at the data to help law firms prepare for the ‘new intake’.
 

If you’re firm handles conveyancing, you know how busy it’s been since the announcement of the Stamp Duty Land Tax (SDLT) holiday. Many have reported problems with capacity, where clients for other legal services have been out on hold while firms make sure clients complete on time.

As buyers and sellers flock to take advantage of the relaxation, it’s no wonder the industry’s seen a staggering 22% increase in monthly property transactions. That’s the equivalent of 171,303 extra deals compared to the same time last year.

But all good things must come to an end.

So it goes with the SDLT holiday, which begins winding down on June 30th, followed by a staggered return to previous rates by October 1st.



 

Spotting trending changes

As the SDLT holiday draws to a close, it’s inevitable that practices are going to see a major drop-off in business.

There’s no evidence to suggest that, past the cut-off date, transactions will remain at a high. Indeed, official figures show the ‘mad rush’ to buy property was already slowing by April, with a 36% decrease compared to March.

Maintaining equivalent levels after record sales, then, means finding new clients – and, at the same time, getting yourself in front of them.

First, you’ll want to look at how the market is changing.

·       FTBs


The data shows it could be a prime time for First-Time Buyers (FTB).

stamp-duty-graph-1.JPG
 
Back when the stamp duty holiday was announced, the share of FTBs using our platform dropped from 55% to 48% - so, while absolute volume remained the same, at the same time, there was a surge in non-FTBs leaping into action to take advantage of the holiday. No surprise, perhaps, given that it benefits non-FTBs more.

At the start of the year, the FTB share reset itself. Again, that’s unsurprising; the holiday was due to end in March. As a result of the extension, it dropped back slightly – so now, with it coming to an end, we can expect to see FTB share increase as the taper begins, rising further by the end of the holiday later this year.
 

·       Average prices

 
The data also points to a potential drop in average prices.

stamp-duty-graph-2-1.JPG
 
Over the last year, the average price by buyer type jumped, in part because by saving on stamp duty, they were able to put down bigger deposits on more expensive properties. That’s unlikely to continue past once the holiday ends.
 

·       Investor share up


Look out for a slight increase in investor share of the market.
 
  Buyer FTB Investor
2021 average price £361,177 £255,542 £198,695
SDLT (before end June) £0 £0 £5,960
SDLT (before end Sept) £5,558 £0 £5,960
SDLT (after holiday) £8,058 £0 £7,434

 
Here we see the stamp duty paid by each buyer type, for their average purchase price so far this year – segmented by holiday, partial holiday, and post-holiday.

FTBs paying on average £255k will not pay SDLT in any of these scenarios, while buyers benefiting now will start to benefit less after the end of June.

The average price of an investor-bought property is low enough that the saving now and the saving beyond June remains the same, so relative to buyers, it’s possible we’ll see an increase, however small, in investor share of market.
 

Preparing for the drop-off

As customers continue to shift online, the future of professional services is changing. People are more at ease finding and buying everything from Cadbury’s Fingers to financial advice on the internet. The days of distrustful customers sending cheques to Amazon are far, far, far behind us.

This is important because customer expectations are changing as a result. And the legal sector’s hesitance in embracing digital transformation – it’s too costly, too time-consuming, too much hassle compared to how we usually do it – risks putting it at a distinct disadvantage.

While we may not see the SDLT holiday market completely dry up until almost the end of the year, now is the ideal time to begin preparing to get ahead of the competition.

You, or an agency working on your behalf should be strongly engaged in a variety digital marketing tactics.
A base strategy must include:

·       SEO
·       Content
·       Online ads
·       Email marketing

As more and more firms begin to ramp up their marketing, placing heavy emphasis on SEO to get found by potential clients, gaining visibility becomes increasingly difficult. Worse, it's time that could be better spent elsewhere, and who can spare that? 

The Law Superstore is a smart and simple marketing companion, helping you reach more clients and scale your business.

For customers, it works like any other price comparison website – they choose the legal service they need and receive price-banded quotes.

For legal practices, the platform offers extra digital visibility across England and Wales. If you choose, it can operate on a ‘fire-and-forget’ principle; set-up your profile, set your services, coverage, and price, and just let potential clients come to you.

Flexibility is built into the platform. Exploring and expanding services, reaching new locations, or trialling a new pricing model – you're free to make the platform your own. 



 

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