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TODAY'S OTHER NEWS

Purplebricks hopes stamp duty reform campaign will dampen criticisms

Purplebricks - which is at the centre of a string of controversies - has joined the growing campaign for stamp duty to be slashed. 

Over the weekend the hybrid agency hit the headlines because of a likely shareholder revolt this coming Thursday over executive bonuses. There has also been substantial speculation that the agency will announce a new fee structure this week, while its annual report published earlier this month admitted that the firm was in talks with HM Revenue & Customs over what may be costly reforms to its anti-money laundering processes.

Now, in a bid to set its own agenda rather than response to outside forces, Purplebricks has produced research claiming that an additional 130,000 homes would come to market each year if the tax was cut - it also shows only a quarter of people believe that Boris Johnson would honour his pledge to reform the duty.

In a large survey of 4,338 adults conducted earlier this month by Glenigan and YouGov, almost a third of homeowners say Stamp Duty is the number one factor which would stop them from moving. 

During his campaign to become Tory leader and Prime Minister, Boris Johnson proposed increasing the threshold of Stamp Duty for residential properties from £125,000 to £500,000 and lowering the top rate from 12 per cent to seven per cent. 

But only 28 per cent of homeowners think Boris Johnson will follow through and make these changes.

Purplebricks says that since the changes to stamp duty in 2014, transactions have fallen by eight per cent. 

If Johnson’s proposed changes were implemented, 90 per cent of people moving home wouldn’t have to pay any duty and 15 per cent more properties would come onto the market each year, claims the agency. 

Although receipts would decrease by £3 billion, the research calculates there would be a £6 billion boost to the UK economy. 

The research also found that if homeowners did not have to pay stamp duty on a property – regardless of its price – 46 per cent would be more likely to move in the next 12 to 18 months. 

Purplebricks chief executive Vic Darvey says: “We believe that changes must be made to stamp duty to help get Britain moving; this would kickstart both the property market and the UK economy.

“Unless stamp duty changes, growing families are less likely to trade up to bigger houses even if space is tight, and older people are less likely to trade down, even though they may be rattling around empty nests. Our research shows that as many as 17 percent of homeowners are currently living in an unsuitable home but can’t afford to move.

“With almost a third of UK homeowners saying stamp duty is the biggest factor that stops them moving, combined with the uncertainty and lack of consumer confidence, we need the Prime Minister to deliver his planned changes to Stamp Duty to help boost the housing market and get Britain moving.”

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    Vic is right

  • Michael Riley

    This overlooks the biggest reason the market had been contracting for years. That is buy to let landlords hold on to their properties when owner occupiers sell, as they go through their life cycle.

    This continued reduction in supply forces prices up in turn improving rents.

    Any change improvement to stamp duty is unlikely... but you can expect the government to get laser focused (oxymoron i know) on getting landlords to release their stock back to the market... that will most probably be in the form of contunued tax increases or a CGT amnesty for landlords selling up.

  • Paul Barrett

    Complete and utter twaddle.
    LL retaining their properties hasn't prevented anyone from buying.
    There is and had been plenty of stock to buy.

    This remains the situation.
    Properties simply aren't selling mostly due to BrExit sentiments along with the inability of those who want to; to be able to borrow what they need.
    Doesn't matter how much stock is available without mortgage possibilities then NO sale!!

    Michael Riley

    The numbers prove otherwise at a macro and micro level in the short, medium and long term. We are in a contracting market. But, you're obviously welcome to an opinion.

     
  • Paul Barrett

    There is no contracting market.
    Just people AREN'T putting their properties up for sale.
    LL bring forced to sell up won't increase demand.
    There are already too many properties for sale but nobody is buying for a wide variety of reasons.
    Forcing LL to sell up does not increase demand.
    Your weird idea that LL buying restricts the availability of property for sale is just too bizarre for words!!
    There has always been a surplus of properties to buy.
    LL only bought them as very few FTB were interested in buying the stock that LL were prepared to buy.
    GR wants everything perfect at the outset.
    The concept of picking up a paintbrush or stripping wallpaper is an alien concept for the little GR darlings.
    LL however are more realistic and able to see property potential and are prepared to put in the sweat equity to restore a property to a proper value.
    GR ISN'T interested in doing hard work.
    This is not how it used to be.
    It was essentially a rite of passage that when starting out as a homeowner you bought a fixer- upper and fixed it.
    Then you moved to a larger property and doso on.
    GR would far rather move into some crappy new-build with a massive loss of value the day they move in and also owe Govt massive debts on the HTB scheme.

    The concept of organic growth based on a homeowners hard work input completely escapes GR.
    LL have effectively been the FTB of old.
    With no FTB prepared to buy it has been left to LL to fix the fixer-uppers!!
    It is not the fault of LL that FTB have declined to buy properties available to all on the open market.

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