London agency Stirling Ackroyd is the latest to call for reforms to stamp duty, with a claim that prices for the most expensive of the capital’s market fell 5.4 per cent in the year to mid-2016.
Nick Davies, head of residential development at the agency, says stamp duty must be cut to get the property market moving.
To demonstrate the point, the agency claims that Labour leader Jeremy Corbyn’s three bedroom property in Holloway, valued at around £700,000, would now cost buyers £25,000 in stamp duty - £3,000 less than in 2015.
However Notting Hill W11, home to Conservative modernisers David Cameron, George Osborne and Michael Gove, has seen property prices fall significantly since stamp duty reforms were first introduced in April 2015, and the downward trend has accelerated since the introduction of the stamp duty surcharge on second homes in April 2016.
The average house price in Notting Hill now costs £1,499,800, having fallen 3.7 per cent quarter on quarter in Q2 2016. Before April 2015, the buyer of an average priced property as a second home in Notting Hill would have paid stamp duty at five per cent, costing £79,500. Now the same purchase would cost £152,100 in stamp duty – an extra £72,600, or a 91 per cent increase according to the agency.
Separately Spencer Botchin, director of Sandfords estate agency, says the three per cent stamp duty surcharge on additional property should be scrapped.
“The additional hikes have hit those looking to buy a second home in London the hardest. Since the new legislation was introduced in April it has proven to be unreasonable, particularly for people wishing to save money. Banks are not offering great interest rates so people have been looking to invest their money elsewhere, but the surcharge is making this much more difficult” he says.
As we reported earlier this week, the Daily Telegraph has launched a campaign for reform of the duty when Chancellor Phillip Hammond makes his first Autumn Statement next week.
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With average houses prices of around £250,000 to £400,000 in most parts of the country, substantial savings are being made by buyers under the new regime. London is essential to all of us, but perhaps the mayor and the London boroughs should set stamp duty in the capital which is more and more like a city state rather than just a capital city.
The stamp duty changes have been wonderful for us agents in the North West and most of the country, saving the majority of buyers an absolute fortune. Long may it continue. As stated above, maybe London needs it's own rules.
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