Impact of stamp duty holiday on local market revealed

UK house prices have hit a record high, according to the Halifax. Picture: Getty Images/iStockphoto

House prices in the East of England increased by £33,008 during the stamp duty holiday. - Credit: Getty Images/iStockphoto

The stamp duty holiday ends today in England and Northern Ireland, meaning the land tax will return to pre-pandemic rates from tomorrow. 

According to Rightmove, the average asking price in the East of England increased by 9.1 per cent between July 2020 – when the tax holiday was introduced – and September 2021. 

Buyers of £500,000-plus properties were able to save £15,000 in tax between July 2020 and June 30 2021, dropping to a maximum of £2,500 when the discount was tapered.

However, the average asking price in our region rose by £33,008 during this 14-month period, from £362,975 to £395,983. 

Throughout Britain, the average increased by £18,197 or 5.7 per cent to £338,462. 

From tomorrow, (Friday), buyers in England and Northern Ireland will once more have to pay stamp duty on all property purchases in excess of £125,000 (£300,000 for first time buyers). 

While Rightmove says there are signs that asking prices are beginning to stabilise, it notes that competition among buyers is double that of pre-pandemic levels. 

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Ross Counsell, director at GoodMove, anticipates that this will quickly change, however. He said: "The majority of people looking to buy a home will have done so by now (in part due to the stamp duty holiday), meaning that the market for buyers should become less competitive."

He added that movers can now take more time searching for a suitable home without the worry of meeting a deadline, potentially "getting a better deal on property prices" as a result.

He added: "Although buyers will have to now pay standard stamp duty rates, it’s likely that this will be less than inflated house prices seen over lockdown and throughout this year."