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Concerns that stamp duty changes are stifling the market
Contentious changes to stamp duty, pushed through by the Government last year, have “paralysed” London’s high-end property market.
New figures show that sales have slumped by over 60 per cent in the nine months since the new systems came into force.
The changes previously announced by Chancellor George Osborne were designed to ease the burden on those looking to get their foot on the property ladder.
But there have been warnings about the obvious consequences at the other end of the housing market, with those buying properties worth more than £2million paying an additional £50,000 in stamp duty.
Ed Mead, director of estate agents Gordon & Douglas, warned that the current situation was likely to have an effect on the whole housing market.
Mr Mead added: “The significant drop in sales of £2m plus properties during 2015 shows the profound impact of the stamp duty changes. Tax revenues will have fallen sharply as a result, so we would urge the Government to consider lowering the higher stamp duty rates.
“Looking ahead to 2016, we are expecting the market to be split around the £1.5m mark. Property worth up to £1.5m could grow in value by as much as 5 per cent, but owners of any property worth more than £1.5m can expect a static year.”
Mark Harris, chief executive of mortgage brokers SPF Private Clients, added: “While the vast majority of buyers were winners in terms of paying less stamp duty after the reform of the tax, those would-be buyers making higher ticket purchases were significantly penalised, frightening many off.”
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