Cuts to stamp duty are set to give the UK property market a boost of more than 25 per cent as thousands of Brits look to cash in.
Research from Barrows and Forrester suggests – based on previous stamp duty holidays – that up to a million homes could be sold due to the cut.
While many home-buyers will benefit, one analyst branded the move “tired, recycled thinking” from the government, saying industry figures remain “highly sceptical” about demand-side moves.
Stamp duty was cut last week in Kwasi Kwarteng’s mini-budget in a bid to boost growth, as millions of households across the UK prepare for what is expected to be a tough winter with high energy and food prices.
In figures released this week, Barrows and Forrester said 923,498 homes were sold in 15 months prior to the last holiday, more than 60,000 a month, and this climbed to 1,167,600 when the holiday was in place, or 77,840 a month.
It is suggested there could be at least a 26 per cent increase in the number of home sales as stamp duty is eased, with the south east set to benefit the most.
During the previous stamp duty cut, in London, property sales were boosted by 35 per cent while in the south east, it was 36 per cent.
“Many of us within the property industry remain highly sceptical about government initiatives that focus solely on fuelling the furnace of demand while doing very little to address the issue of supply”, danaging director of Barrows and Forrester, James Forrester, said.
“The latest stamp duty changes are just more of the same tired, recycled thinking by the government”.
“Despite the long term impact these cuts will have on topline housing affordability, there’s no doubt they will act as a tantalising carrot to current homebuyers, tempting them back to the market after initial signs that the pandemic property market boom was starting to ease.”
“We’ve already seen what a stamp duty saving can do in terms of boosting market activity and so we can expect to see more of the same, albeit at a perhaps less frantic pace as there is no expiry date on the tin, as it were.”