Logo

North London agents say government’s abolishment of stamp duty won’t help first-time buyers in the capital

PUBLISHED: 16:27 22 November 2017 | UPDATED: 09:36 23 November 2017

Chancellor Philip Hammond holding his red ministerial box outside 11 Downing Street before heading to the House of Commons to deliver his budget. Picture: Joe Giddens/PA Wire

Chancellor Philip Hammond holding his red ministerial box outside 11 Downing Street before heading to the House of Commons to deliver his budget. Picture: Joe Giddens/PA Wire

Housing analysts and north London estate agents are among many who believe abolishing stamp duty for first-time buyers will have little impact on the capital’s housing crisis

Chancellor Philip Hammond announced as part of the autumn budget today, that the government will abolish stamp duty for first-time buyers on purchases of up to £300,000, and on the first £300,000 of purchases up to £500,000.

Mr Hammond also promised £1.5bn to “address concerns” about the flagship universal credit scheme, and unveiled lower growth forecasts.

A number of mortagage lenders, housing analysts and north London agents have since criticised Mr Hammond’s cut to stamp duty for first-time buyers, although one agent has reacted more positively to the announcement, claiming his agency have seen two exchanges and two deals agreed today since the budget was announced, from buyers “who have been holding back waiting to see what Phillip Hammond had in store for us”.

The stamp duty regime up until these changes has resulted in 146,000 fewer housing transactions during the past five years, according to a report published last week by lender Santander and think tank, the Centre for Economics and Business Research.

Housing was therefore always going to be one of the key themes of this autumn budget, for which the chancellor has pledged that for the “next generation”, getting on the housing ladder will not be just a “dream”.

Promising the government would deliver 300,000 new homes a year, he declared a £44bn capital investment and measures aimed at getting building projects started. Towards the end of his speech, Mr Hammond also made the pledge on stamp duty, which is paid by people buying properties over a certain value. Rates vary across the UK - in England, Wales and Northern Ireland it kicks in at £125,000.

Mr Hammond said his change would benefit 95 per cent of first-time buyers, but mortgage lenders and housing analysts have said the initiative would do little to help those struggling to buy.

The OBR (Office for Budget Responsibility) are particularly damning about Mr Hammond’s proposal, believing the stamp duty cut for first-time buyers will push house prices up.

“We expect this to increase house prices by 0.3 per cent, an estimate consistent with our published price elasticities for stamp duty changes. Most of this effect is expected to occur in 2018.”

The OBR also said the main gainers will be people who already own property, not first-time buyers.

“We assume that a temporary relief would feed one-for-one into house prices, but a permanent one will have twice that effect. On this basis, post-SDLT (stamp duty land tax prices) prices paid by first-time buyers would actually be higher with the relief than without it. Thus the main gainers from the policy are people who already own property, not the first-time buyers themselves.”

James Morton, director of north London estate agents Benham & Reeves is also critical of Mr Hammond’s proposals. He said: “We welcome the stamp duty cut for first-time buyers, and for lower priced homes, but first-time buyers still need properties to buy. Unfortunately, London prices are mostly over £300,000 anyway and much of the London market is being strangled by higher stamp duty, meaning second-time buyers are staying put rather than moving on, so this will have little impact on the capital’s housing crisis.

“Furthermore, the commitment to building more homes is also good, but house-building targets have not been met for so long now that today’s announcement offers too little, too late.

“Like many of my colleagues, I feel that the chancellor has missed a valuable opportunity to help the UK housing market today and I’m disappointed that hard-working Londoners will continue to be squeezed by unfair, regressive property taxes.”

Mark Pollack, director of Aston Chase has taken a more positive view of the chancellor’s announcement. He said: “The absence of any further negative measures is good news for the prime London residential market, as ‘appeared’ stability is long overdue! We have already had two exchanges and two deals agreed today, since the budget, from buyers who have been holding back waiting to see what Phillip Hammond had in store for us.”

Are you a first-time buyer? How do you feel about the changes to stamp duty? We would like to hear from you. Email amelia.glean@archant.co.uk

Related articles

Property search


e.g. Oxford or NW3
Powered by Zoopla

Other Hampstead and Highgate property news

Alexandra Palace area guide: the hills, the house and hunting for a bargain

Your guide to things to do in Alexandra Palace, including the best shops, cafes, restaurants and schools. PLUS our guide to property in N22

Comment: What’s in store for 2018?

Trevor Abrahmsohn, managing director of estate agents, Glentree International, offers his predictions for 2018 on everything from property to the World Cup

Primrose Hill family selling historic home after more than 60 Christmases

Originally constructed by renowned Victorian builder William Willett, the seven bedroom house, in Primrose Hill, is now on the market for £15,000,000

North London extensions shortlisted for top design award

Two north London extensions have been shortlisted as among London’s best and most innovative home improvements.

Three table setting themes to inspire you this Christmas

Gabrielle Fagan reveals how to create a Christmas table that’s a feast for the eyes

How to grow your own garlic

If you’re finding that shop-bought garlic doesn’t have the intense flavour you require, then it’s time to start growing your own, which will give you more choice and more flavour.

London house prices now a record 14.5 times higher than average income, figures show

Average house prices reached £496,000 and average earnings were £34,200 in London this year, yet a north London agent says the comparison is not an accurate representation of the capital’s property market

Decor experts Rockett St George reveal their recipe for stunning style

Jane Rockett Lucy St George share their vision for imaginative, inviting interiors with Gabrielle Fagan

Regent’s Park: a historic royal park home to wandering tourists, exclusive elites and everyday Londoners alike

Tom Ford and Damien Hirst might hide away behind the iconic Stucco frontage of the Nash Terraces, but out in the open Londoners mingle with tourists, geese and budding athletes amongst the green space

1960s pebbledash property in Highgate transformed into ‘3D’ family home

The uniquely designed property with an abundance of space, natural light and top of the range amenities, allows the family to dictate how they want to live

How to make a Christmas candle centrepiece for your table

As thoughts turn to festive decorations, garden centre expert Alex Cawley gives us a crafty Christmas masterclass

The reason everyone should own a water butt and how to build one at home

Richard Burr shares his top tips for a DIY rainwater butt

Have your dahlias gone black? It’s time to put them away for the winter - follow our 5-step guide

If you want to enjoy your dahlias next year, dig them up now and store them for winter. Here’s how to do it

The former Camden Mews home of Madness lead singer, Suggs, is for sale

In his autobiography, the former Madness lead singer cited the famous “Our House” single, inspired by the Camden Mews property, as the band’s most successful song

6 things to think about when choosing the right Christmas tree for your home

As Christmas trees arrive in garden centres, expert David Mitchell offers advice to those who only have a small space for a real tree

For sale in Swiss Cottage: top three

This weeks three properties with spacious accommodation, period stain glass windows and a roof terrace

4 ways to transform your Christmas tree

Looking for some seasonal decor inspiration? Gabrielle Fagan reveals her favourite festive finds

Home of the week: Unique penthouse-style apartment in Hampstead

This weeks choice is a property with double volume ceilings and spectacular views over central London

North London developer says the cut to stamp duty is a “gamechanger” for first-time buyers

Abolishing stamp duty for most first-time buyers will make it easier for them to get on the property ladder, according to a north London real estate developer

Comment: My response to the Chancellor’s budget

Trevor Abrahmsohn, director of north London agents Glentree Estates, believes the governments new housing proposals, as part of the Budget 2017, will go some way into making home ownership “a human right, rather than a privilege”

North London agents say government’s abolishment of stamp duty won’t help first-time buyers in the capital

Housing analysts and north London estate agents are among many who believe abolishing stamp duty for first-time buyers will have little impact on the capital’s housing crisis

Winter patio pots looking lacklustre? Try 3 things to perk them up

Perk up your winter pots to keep them looking fabulous over the festive season

How to install a hidden wall safe

A discreet safe to keep valuables protected isn’t just something for the rich and famous to consider. Richard Burr reveals how to fit one

Christmas gift guide: 14 top picks for gardeners and green-fingered types

From sweet stocking-fillers to wow-factor pressies, these are bound to delight

Comment: My letter to our illusive housing minister

According to Simon Gerrard, managing director of Martyn Gerrard estate agents, the government are failing to deliver a strategic approach in response to the housing crisis

Former Hampstead guesthouse is for sale as a 7 bedroom residential home

Owner, Annemarie van der Meer hopes to sell the property to a buyer looking for a spacious family home

For sale in Highgate: top three

On the market this week are three historic properties with period features, high ceilings and far-reaching views in an eviable location

The Japanese wonder toilet taking the world by storm

TOTO, inventor of the ‘Washlet’, claim the rate of sales for their product in Europe has doubled year on year since launching in 2009

5 things to consider before storing your garden tools away for winter

Give your tools some TLC before you put them away for the winter. Our guide shows you how to look after them - and make them last

Home of the week: Converted Hampstead church

This weeks choice is a former Presbyterian Church, boasting a galleried mezzanine floor with rooftop views

Newsletter Sign Up

Sign up to the following newsletters:

Sign up to receive our regular email newsletter

2017 © Archant Community Media Ltd

Terms and conditions | Cookie policy | Jobs at Archant