The sheer scale of the drop in property sales following the introduction of higher Stamp Duty rates for buy-to-let landlords and second homebuyers has been revealed.
Property transactions plummeted in volume during April, the month that the 3% Stamp Duty surcharge was brought in, according to official figures.
The consequences of the higher Stamp Duty rate have been exposed in the Office for National Statistics’ (ONS) property market index. A guide to how the surcharge will affect you can be found here: https://www.justlandlords.co.uk/news/landlords-guide-stamp-duty-surcharge/
The June data – for which the latest figures are available – shows just how sharp a drop in property sales followed the rush to beat the 1st April Stamp Duty deadline.
The former Chancellor, George Osborne, introduced the higher tax rate for those purchasing a second home or investment property in April.
From March 2016 to April, property sales in the UK dropped from 124,296 to 56,072 – a massive 55.4% decline.
English regions recorded falls of up to 70%, led by the capital, where volumes tumbled from 14,783 in March to 4,368 in April.
Some London boroughs experienced decreases of more than 80%. In Kensington and Chelsea, property sales plummeted by a huge 88%, from 393 to 46 between March and April.
Similarly, transactions in Camden dropped by 73%, from 365 to 95.
The smallest regional decline in property sales in England was in Yorkshire and the Humber, where volumes fell by 48%.
Property expert Henry Pryor responded to the figures on Twitter, calling on the new Chancellor, Philip Hammond, to “wake up” and recognise that Stamp Duty is “killing the market”.
However, an analyst at Savills, Neal Hudson, urged professionals to “not get over-excited by comparing April to the March SDLT [Stamp Duty Land Tax] spike in transactions”, as a decline is natural after such a great increase.
Regional declines in property sales
Region Property Sales - March 2016 Property Sales - April 2016 Decline
London 14,783 4,368 70%
South West 12,297 4,741 61%
South East 18,583 7,510 59%
East of England 12,607 5,312 57%
East Midlands 9,347 4,218 54%
West Midlands 9,569 4,341 54%
North West 12,606 5,916 53%
North East 3,912 1,987 49%
Yorkshire and the Humber 8,893 4,545 48%
Landlords, have you purchased a property since the higher rate of Stamp Duty was introduced?
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