A recent study conducted by polling company Opinium and estate agent Jackson Stops has shown that thirty per cent of homeowners say they would consider moving home more regularly if the stamp duty holiday on the first £500,000 of a home purchase became permanent. This could equate to an additional 350,000 housing transactions per year.
This builds on the success of the current scheme in stimulating demand. Jackson-Stops’ own data shows that new applicants shot up by 64% on the year during the three months to May. Now, on average, 22 buyers are chasing every instruction across its nationwide network for branches, evidence of the vast appetite that exists to move home at the moment.
To determine attitudes towards the future of SDLT in the UK, Opinium and Jackson-Stops surveyed 1,837 consumers in England, Wales, and Northern Ireland. The results revealed that Britons overwhelmingly believe that the tax is hindering their ability to move more often, with 3 in 5 (61%) supporting an overall reduction in stamp duty across all price brackets.
The effect on first-time buyers
The current stamp duty holiday has made 18-34-year-olds more likely to buy a home – 20% say that they are either currently looking or agree that they are likely to buy a home before the stamp duty holiday ends. 44% of this age group also agree that they would consider moving home more frequently if the holiday were made permanent.
On a regional basis, those in London were significantly more likely to agree with this statement (47% vs. the national average of 30%).
Overwhelmingly, Britons are in favour of permanent relief for first-time buyers. Seven in ten adults (70%) say they would support first-time buyers not having to pay stamp duty. Of all options listed for how stamp duty could be changed, this received the highest level of support. Older respondents are just as in favour of this proposal as younger respondents. 72% of those aged 55+ support permanent relief for first-time buyers, as well as 71% of 18–34-year-olds.
The effects on the decision to downsize
The prospect of making the SDLT holiday permanent is less appealing to older Britons. 61% of those aged 55 and above say a permanent SDLT holiday would not make them more likely to consider a move. This group was also the least likely to agree that sellers should be made liable to pay stamp duty instead of the people buying (35% vs. the national average of 31%).
Nick Leeming, Chairman of Jackson-Stops, commented: “Over the last ten months we have seen how successfully the SDLT holiday has supported the housing market, creating a level of demand that we haven’t seen for a decade. On the other hand, this research demonstrates how SDLT can stifle transactions, significantly reducing the market’s full potential and limiting the economic opportunities that arise out of a thriving property sector. Permanent reform of property taxation and regulation, including SDLT, could help the market translate this momentum into sustained, long-term success, while better supporting the aspirations of buyers and vendors, and giving businesses across the UK the opportunity to recover and grow.
“For example, were the current holiday made permanent, the evidence suggests that this would support demand, increase supply, boost transaction numbers and increase the number of stamp duty receipts overall, at the same time as providing key financial relief to first time buyers who are so crucial in supporting entire chains across the country. Furthermore, increased house buying would ensure additional use of conveyancing services, surveyors, removal firms, and homewares retailers, all of which would contribute significant amounts to the economy every month.
“The residential market has made great strides over the past 10 months under the most challenging of conditions and relief schemes such as the SDLT holiday have allowed many more people to find their next home and rebalance their lifestyle at the same time. Of course, we need to consider stamp duty alongside the entire range of factors that influence market activity, however, what is clear is that, after the last 10 months, it would be a mistake to automatically revert to the previous system when we have an opportunity now to think about how we reframe the role tax plays in supporting a healthy long term future for the sector.
