Zoopla Figures on Stamp Duty Change – Thoughts from the Industry
Following the release of Zoopla’s latest figures on the upcoming stamp duty changes and the impacts on First Time Buyers here are some thoughts from the Industry.
Toby Leek, NAEA Propertymark President:
“The increase in Stamp Duty charges from April is clearly going to impact buyers in some parts of the country more than others. London and the South East are the two most expensive regions in England to buy a house, and April’s changes will make it harder for first-time buyers to step onto the housing ladder compared to those living in the North of England. Even though the Office for National Statistics figures show that earnings growth rose to 5.9 per cent, house prices continue to be over 10 times more expensive than the average salary needed to buy a home. However, in order to bring house prices down in the long term, Propertymark looks forward to hearing from the UK Government how they intend to recruit the necessary workforce to build 1.5 million new homes by 2029.”
Simon Gerrard, Chairman of Martyn Gerrard Estate Agents:
“These upcoming stamp duty changes will disproportionately affect first-time buyers in London, where housing is much more expensive, with 97% of sales set to pay Stamp Duty from April. In other areas, the impacts will be less pronounced. On the ground, we saw a big uptick in interest from first-time buyers in the last few months as they sought to get ahead of the changes, which will add thousands to the cost of buying a home.
“Some of the negative impacts may be offset by the Bank of England lowering interest rates, which will make mortgages more affordable, but it could also see house prices increase even further. The route onto the property ladder still contains so many barriers and the upcoming Stamp Duty threshold reductions will only aggravate an already dire situation. More must be done to help first-time buyers in London. They need more support, not less.
“Earlier this year, the Chancellor’s proposed solution was to ease lending rules to permit lower deposits, which may seem attractive, but the short-term demand stimulated by relaxed mortgage rules won’t be matched by a simultaneous increase in housing supply. It will only drive house prices up further in the short-term as the market re-finds its equilibrium, putting buyers in an even more precarious position should the market turn. In effect, the Government is looking to offset the damage to the market by raising taxes by injecting more risk. It would be more sensible to just keep Stamp Duty relief for first time buyers in place, or better still abolish it for first time buyers.”
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