The Government’s Stamp Duty, specifically the £250,000 threshold has come under fire from the industry as new research emerges.
The Government’s Stamp Duty, specifically the £250,000 threshold has come under fire from the industry as new research emerges.
According to the research, commissioned from Cass Business School by the London Central Portfolio, there are 93% more transactions of homes priced between £240,000 and £250,000 than between £250,000 and £260,000.
The research also stated that 13,866 vendors were forced to sell at significant discounts, some of which were as high as £10,000. Not only that, but 73% of home owners have properties between £125,000 and £250,000 (the points at which Stamp Duty kicks in at 1% and 3% respectively – a threshold that has not been changed since 2000 when the average house price was £79,242).
In addition, the report also raised some alarming statistics:
- 93% more transactions occur just beneath the 3% Stamp Duty threshold than above it
- 9,721 homeowners a year unable to sell because of threshold
- They may have to wait 2.5 years to get a fair price for their property
- Additional 13,866 forced to sell their property at up to a £10,000 price discount
- At least 50,000 households will face a £7,500 Stamp Duty tax bill in the next five years
- 73% of market sit in precarious price band between £125,000 and £250,000
- Every time Stamp Duty % rate is increased, spike in sales under £250,001 gets higher
LCP chief executive Naomi Heaton said:
“The Government need to grasp the nettle and reduce the tax hike at £250,001.
“While it will have a cost to the Exchequer, it will be a drop in the ocean compared with the stimulus packages already introduced.
“The long-term impact for these packages is unknown and probably dangerous, whilst reducing the Stamp Duty rate is guaranteed to make a difference for good, for second steppers and first-time buyers.”