Stamp duty reform set to bolster sales in SW
Pace of price growth in the South West accelerated slightly over the last three months and new reform in the Autumn Statement is expected to boost sales
House price growth in the past three months accelerated slightly in the South West and new Stamp Duty reforms see surveyors forecasting a sales boost of between 2-5%, according to the latest RICS Residential Market Survey.
Despite a net balance of 17% more surveyors reporting a decline in new buyer enquiries in the South West, supply in the region has improved in November and surveyors are expecting more house sales in response to the stamp duty reforms.
Across the rest of the UK, price growth was strongest in Scotland and the South West (both a net balance of 37%) and weakest in the North of England and London.
Across the rental market, tenant demand in the South West was steady in November, but landlord instructions declined for the eighth successive month and member’ forecasts for rent over the next 12 months now stand at 2%.
Roger Punch, South West residential market spokesperson, commented: “The Stamp Duty changes are most welcome, removing the artificial “steps” and providing extra fuel especially to the lower sections of the market, which is very relevant to much of the South West. Confidence in the New Year will inevitably hinge on the strength of the wider economy.”
Simon Rubinsohn, RICS Chief Economist, said: “The Stamp Duty reform could reverse the softer trend in buyer enquiries that has been visible in recent months but a critical issue in terms of how it plays out with prices is whether it also encourages more vendors to consider putting their properties back onto the market. The expectation from members that transactions could increase by up to 5% over the next year on the back of this measure suggests that there is a belief that supply will indeed respond to the tax change. This is all the more important given that the latest RICS data suggests that the average level of inventory on surveyors’ books in the UK is close to historic lows.”
Jeremy Blackburn, Head of Policy at RICS, said: “It’s no surprise that surveyors are expecting an uplift in the market in response to the long overdue reforms to the stamp duty tax system which the Chancellor himself called ‘the most damaging tax of all’.
Removing the ‘dead zones’ will reduce the distortion in the market and ensure that those at the top end of the market will now contribute fairly, while those at the bottom will be given a fairer chance to get on the ladder.”
