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There’s more to do Mr Chancellor

Most Budget speeches can give anyone a cold – to which Mr Hammond alluded as he reached for the cough sweets.

But at least his affliction had not muffled his hearing. He had clearly heard loud and clear that the Stamp Duty regime is causing acute distress not only to the property-owning public, or more evidently those who want to be, but also to the entire house market.

In recent weeks, there has been a raft of opinion and academic research from various participants in the market – including, most notably, your very own Family Building Society – to bring this sorry state of affairs to the Chancellor’s attention and invite him to act.

And, bless him, act he did.

Tax holidays don’t work, according to most economic experts - including our partners in this adventure, the London School of Economics who recently published a report into the effects of stamp duty on the housing Stamp duty resizedmarket – you can down load a copy here.

So, at a stroke, the Chancellor abolished Stamp Duty for First-Time Buyers for any purchase under £300,000 though the relief will not apply to purchases above £500,000.

According to HM Treasury, this will mean 80 per cent of first-timers will pay no Stamp Duty at all and 95 per cent will benefit up to a maximum of £5000.

Yet, far be it from us, who have campaigned long and hard for Stamp Duty reform, to appear ungrateful but this is only addresses half the problem.

It is the older generation, generally those whose children have flown the nest and are rattling around in a house with too many bedrooms or otherwise unsuitable for their needs, who are dissuaded to move because they don’t want to write a cheque to HRMC simply for the privilege of doing so.

These are not ‘rich’ people - the majority of revenue comes from sales of much more typical homes, particularly in the South East: 58% of revenues were from properties worth between
£250,000 and £1 million.  By and large, they are people who have lived in the family home for many years. They now wish to downsize, or retire, or simply move house to be closer to family.

And it is this unfairness which causes the greater problem – a lack of housing stock further along the supply chain.

So, thanks very much, Mr H, but would you mind awfully taking another look?

The problem is that Stamp Duty is the easiest tax to avoid – you just don’t move.
So let’s get people moving again!

Thanks.

By Steve McDowell

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