The amount of sales of homes worth over £1.5m is expected to drop for the first time in two years due to Stamp Duty reform.
Jackson-Stops & Staff estate agent says that sales have been affected, halting and potentially reversing the 36% annual growth witnessed between 2012-14.
Sales of High Price Homes Halt
Nick Leeming, Chairman of Jackson Stops & Staff, which has 44 offices nationwide, says: “The wider UK residential property markets are reasonably buoyant now.
“However, the revision to Stamp Duty rates late last year has contributed to the widespread stagnation of the higher valued markets in 2015, both in London and the country, where many properties are finding it difficult to attract buyers.
“Sale volumes have plateaued across the country in response to high transaction costs, reflecting the fact that the UK has one of the highest taxed property sectors in the world.”
The reform means that buyers of properties worth between £925,001-£1.5m must pay an extra 10% in Stamp Duty, and those buying homes worth over £1.5m now have a further 12% to pay.
Leeming continues: “We have an ageing house-owner population with too few younger entrants onto the property ladder.
“Mortgage funding is difficult to raise for people in their 40s, even if they have been previous house-owners, irrespective of their credit history.
“We need to encourage trading down so that larger houses are released to families needing more space.”1
Director of Jackson-Stops & Staff in Sevenoaks, Kent, Alastair Hancock, adds: “Over a third of our available stock is priced in excess of £1.5m and this is no wonder given what little incentive there is for buyers at the mid to high end of the market currently.
“Since the Stamp Duty hike last December, we have seen a significant decline in volume of sales at this level.”1