Spicerhaart boss Paul Smith is backing Boris Johnson’s calls for Stamp Duty to be cut right across the housing market – and has said that the Government has got its landlord-bashing policies “badly wrong”.
Johnson said in the Telegraph yesterday that Stamp Duty levels were “absurdly high”, particularly hitting first-time buyers – despite evidence from the Halifax that the number of first-time buyers is actually at the highest for ten years.
Smith yesterday agreed both with the call for Stamp Duty to be cut, and with the rise in first-time buyer interest.
He said: “I welcome calls from Boris Johnson to cut Stamp Duty across the housing market.
“You cannot doubt the impact the Government’s Stamp Duty cut last autumn has had on the first-time buyer market.
“In July we saw 22% more first-time buyers registering to buy than the same time the year before. Surely it is a no-brainer for the government to look to how they can replicate this success across other areas of the market.
“Perhaps most damaging for young people is the government’s policy of a 3% Stamp Duty surcharge for buy-to-let investors.
“The surcharge for investors has reduced the number of rental properties available as landlords have stopped buying in the same volumes.
“This, in turn, has led to increased rents which means young people are spending more on rent than ever before, a further stumbling block for first-time buyers looking to get on the ladder.
“A cut in Stamp Duty for investors would incentivise landlords to come back to the market and stop rents from spiralling out of control. The Government has got this badly wrong and must change course.
“I would also welcome a Stamp Duty cut for downsizers.
“We know that over-55s are much less likely to want to move than young people, and it is the cost and hassle of moving that puts them off.
“As a result, prices for in-demand family homes are far outpacing the average house price rise, and many families are finding themselves priced out of their own market. A Stamp Duty cut would act as an attractive proposition and an alternative to staying put, freeing up crucial family homes.”
Comments (7)
Stamp Duty is just a tax – nothing more and nothing less. It is a purchase tax on people trying to buy themselves somewhere to live. All property below £1m should not attract any form of purchase tax.
stamp duty may be high but then so are house prices.
however I do agree taking private landlords out of the housing market cant be good for social housing needs, particularly if the government want zero homeless on our streets.
The UK governments are all about raising tax when revenue is needed, rather than attracting investment (foreign and domestic) within the UK, and then reaping increased taxation. Hence the USA beat us in the war to form their country. No lessons learnt.
But there should be no tax on putting a rook over ones head,.
The Government does nothing effective to help the housing market, and yet the easiest task to get right is to abolish stamp duty full stop – certainly for FTB and the retired, AND public sector workers (as the Government already pay them peanuts (e.g teachers)).
Sadly, they don’t listen, and when they do make Budget changes, they rush in changes – e.g Help2Buy 20% loans – and it is verbose, complicated and they fail to revisit it to make big improvements.
To be honest this article is absurd. Firstly I was against any reduction in stamp duty for first time buyers and would be against any further increasing of the reduction. In my opinion if you cant save up the stamp duty then you arent in a good enough financial position to buy a house. Perhaps harsh, but i stand by it, for the same reason i was always against 100% mortgages, buyers need to have some money.
Secondly if the author is so pro FTBs then he should be all for the second home surcharge as it is intended to help first time buyers.
The house market is over inflated through a raft of measures introduced by various governments and the low bank base rate. The market is going to reset itself at some point, but any false propping up between now and then will only make the fall harder, a natural cooling down process between now and then will make life during the recession less painful.
With respect I’m not sure you read the same article. The call from Boris Johnson was to cut Stamp Duty ACROSS the market, the reference to first time buyers was how indeed the cut in stamp duty has seen a number enter the market ….and it has!
The problem stamp duty has created is that, particularly in London and the South, the market is very asset rich cash poor, so high levels of stamp duty as we see now, just simply stop people moving unless they absolutely have to. A property at £1,500,000 will actually cost someone close to £100K in stamp duty alone, that has a massive ability on borrowing as that is straight out of someones equity for a purchase.
You may think thats a problem that affects the rich so why should we care, well why we should care is that the buyers of these houses often come from the £600- £800K price range, if they don’t move then then don’t sell and so the £400-£500K houses have nowhere to move to so they don’t sell either…..I think you get the idea.
Exactly that. It’s a top down market.
With people saving to find higher deposits now, having to save nearly £4k extra is going to add an extra year or two before they can buy. Stamp duty is slowing the entry of the FTB to the market, it can be seen as good as there is a shortage of new houses, but without FTB the market will not move, as Landlords have no incentive to buy rentals at the moment, so the £125k house won’t sell. They won’t buy the £175k house, who can’t buy the £280k house etc.
I still have no idea what the SDLT is actually used for…