Date Published 09 July 2019
Conservative leadership frontrunner Boris Johnson's plans to reverse stamp duty changes could help to kickstart the prime property market.
Prior to December 2014 any property priced between £1 million and £2 million was charged stamp duty at a rate of 5% with anything over £2 million taxed at 7%. However, George Osborne's reform of the stamp duty system system introduced tax rates of 10% on any property costing over £1.5 million.
It has been well documented that the changes have had a significant impact on transactions and average prices in the prime property market particularly in London.
Talking about his plans for a first budget should he become Prime Minister, Johnson described stamp duty as a 'problem' and said tax cuts would get the 'locked up' market moving.
As well as cuts to high-end stamp duty, Johnson also mooted cutting tax further at the lower end of the market with the aim of helping first-time buyers.
"I think particularly in London there is clearly a problem with stamp duty and it needs to be addressed," Johnson told the Telegraph.
"I'm not going to put a figure on how much we're going to cut but we will certainly be looking to do that because I think actually you can do that in such a way as to increase revenues if you get it right because the market is locked up at the moment."
A stamp duty reprieve at the top of the market could see an uplift in prices and would certainly benefit the residential buyers.
Although the market has adjusted and price growth stabilised there is still an air of hesitation across the market due to the political landscape, so a reversal of stamp duty changes could provide the adrenaline shot that is needed to entice more buyers back to the prime and super-prime markets and this will hopefully see prices increase.