Make stamp duty holiday permanent suggests top agency

Knight Frank says the stamp duty holiday for properties at £500,000 and below should be made permanent.

The holiday is due to expire at the end of March next year and saves buyers up to £15,000 depending on the cost of the property.

“On a multi-million pound property, the saving will be a small percentage of the transaction price but it represents a meaningful discount for the vast majority of UK buyers” says the agency, which adds that the holiday has helped the housing market become - for now at least - “as robust as it has been for many years.”

The agency says there is plenty of evidence to show how effective the holiday has been at encouraging market activity.

The number of offers accepted between July 8 and August 3 was 146 per cent above the five-year average for properties valued at less than £1.5m, the section of the market where the impact of the holiday would be felt most.

Above that figure, the increase was 71 per cent.

Similarly, the number of new prospective buyers registering in the same period was 100 per cent higher for sub-£1.5m properties compared to a 70 per cent increase above that value.

And Knight Frank says the number of viewings has also grown by more for sub £1.5m properties, rising 46 per cent versus the five-year average. Above £1.5 million, the increase was 13 per cent.

The agency likens the SDLT holiday to the government’s Eat Out to Help Out scheme since it launched a week ago, saying that both have given real impetus to consumers to take advantage of the deals.

“The holiday, it must be concluded, is working. Whether it should become a permanent arrangement is something the government should consider” says a statement from the agency this morning.

It adds that old levels of stamp duty could be regarded as self-defeating because they deter buyers and therefore reduce spending in property-related areas of the economy.

“More companies are announcing job cuts and any additional financial friction around the mobility of labour or people unfortunately made redundant could prove counter-productive …If more people are moving home, that is good for the economy well beyond the confines of the housing market” the agency concludes.