Trevor Abrahmsohn, one of London’s best known estate agents and a founder of OnTheMarket, says stamp duty should be split between buyers and sellers.
Writing in business newspaper City AM, Abrahmsohn - the managing director of estate agency Glentree International - says that since George Osborne became Chancellor stamp duty changes have been used to political effect.
“It is a lose, lose strategy. First time buyers are further disenfranchised by the runaway market at the lower end, meanwhile the middle to top end has been hit with a sledgehammer, with prices down by up to 35 per cent from the former highs of 2014 and the Treasury losing valuable revenue which, given its deficit reducing strategy, is somewhat foolhardy” insists Abrahmsohn.
“Estate agents and many other ancillary businesses connected to the residential property market are in a parlous state with lay-offs, redundancies and closures being the order of the day” he adds, saying that those agents “still standing” nurture the hope that current Chancellor Phillip Hammond may reform the tax in a more housing market-friendly way after the June 8 General Election.
However, the agent says that if Hammond cannot be persuaded through lobbying to reduce the higher rate of stamp duty “then it is my view that he should consider arranging the seller and buyer to split this liability between them.”
Abrahmsohn accepts the seller will not be happy to pay around six per cent duty as part of the sale, but the buyers “will effectively have their liability halved and this may stimulate the dampened market and perhaps, if values rise as a result, then the sellers would be compensated by the growth to balance their tax liability."
He concludes: “If this is Plan B then it is far better than the worrying situation at present where sitting put is actively encouraged, which works against the liquidity of the marketplace and everyone connected with it.”