‘As expected, there was a huge decrease in property transactions in October, falling by 50 per cent as people rushed to take advantage of the stamp duty holiday on transactions below £250,000 before the relief was phased out at the end of September. Transactions in October were the lowest for the month since October 2012.
‘However, the bigger picture shows that residential transaction for the seven months to October is the highest it has been over the last ten years, highlighting the changing demands from home buyers as they seek more space to live in, and the recovery from the pandemic, when April 2020 to October 2020 saw significantly reduced transactions.
‘Furthermore, the relief of stamp duty land tax given in the first half of this financial year highlighted caused some market volatility, with housing transactions being over 200,000 in June but under 75,000 in July and October. Additionally, previous RSM research has identified the frustration our clients and contacts feel about this tax and the need to permanently reform (and reduce) it in order to achieve a more stable and fairer housing market. In particular this would encourage younger families to upsize, older people to downsize and would stimulate much needed supply in the market, rather than stimulating demand which results in higher and higher house prices, making the property ladder impossible to get onto for some.
‘In hindsight, the pent-up housing demand and low interest rates meant that this temporary stamp duty land tax relief was probably not necessary and cost the government £6bn.’
Stacy Eden, partner at RSM UK