Bidding wars for homes continued in July despite tapered stamp duty holiday

Home buyers are still showing a willingness to pay over the asking price for properties, despite the stamp duty holiday being tapered from July.

The average home sold in England and Wales in July achieved 100.3% of its initial asking price, according to estate agent Hamptons.

This was only fractionally down from a record 100.4% in June – the month the full stamp duty discounts came to an end.

From July 1, the “nil rate” stamp duty bracket in England and Northern Ireland halved from £500,000 to £250,000. From October 1 it will revert to £125,000.

Property professionals had reported a rush of buyers trying to get house sales over the line before the June deadline.

However, a lack of available properties is helping to keep prices up, Hamptons said.

It added that bidding wars remain common. More than a third (38%) of homes sold in July had offers from three or more potential buyers, up from 28% in July 2019.

Hamptons said Scotland remains the most competitive market. Nearly half (48%) of homes sold in Scotland last month received three or more offers.

More than two-fifths (44%) of buyers paid over the initial asking price last month, as did three in 10 (30%) spending £1 million-plus on their new home.

The average time to sell a home in July remained at the fastest Hamptons has recorded, at 22 days, even though many buyers who agreed a sale in July are likely to miss out on the stamp duty holiday altogether.

Aneisha Beveridge, head of research at Hamptons, said: “July marked the first month after the stamp duty holiday began to be unwound.

“In more normal times, the weeks and months following the end of a stamp duty cut would be noticeably quiet, with many moves having been brought forward to take advantage of the tax break.

“But this time around it seems unlikely the market is on course for a particularly painful hangover.”