Stamp duty cut for first-time buyers having minimal impact on market, says property expert

Helen Cahill
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Political Uncertainty Dampens UK Housing Market
The OBR has said the stamp duty cut will push up house prices (Source: Getty)

Stamp duty changes announced in the budget are having little effect on the housing market, property experts have said.

Buyer interest fell in December, according to a survey from the Royal Institute of Chartered Surveyors (Rics), and market activity continued to fall.

When respondents were asked if they had seen an increase in enquiries from first-time buyers, the majority of (86 per cent) across the UK said they had not.

Read more: Here's how much London house prices fell in November

In the Autumn Budget, Philip Hammond unveiled a stamp duty holiday for first-time buyers purchasing homes worth up to £300,000. Stamp duty was also axed for first-time buyers on the first £300,000 of any purchase worth up to £500,000 in London. The pledge was part of the government's renewed focus on housing.

Transaction activity fell in December, with 13 per cent more respondents reporting a decline in sales volumes month-on-month. But, surveyors predicted a marginal increase in prices over the coming months.

Read more: Why the stamp duty cut is no more than a short term fix

Simon Rubinsohn, Rics chief economist, said: "The initial feedback from the market doesn't suggest that the stamp duty regime announced in the budget is going to have a material impact on activity. Indeed, the risk was always that a good portion of the benefit would be capitalised in the price, therefore limiting the benefit for the first-time buyer."

When the chancellor first announced the stamp duty holiday, the Office for Budget Responsibility (OBR) said the measure would push up house prices slightly, thereby benefiting home owners.

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