Stamp duty cut fails to boost flagging housing market

Stamp duty cut fails to boost flagging housing market

Looking ahead, sales expectations nationally remained flat for the coming three months, but nearly 30% more were positive about the next 12 months.

In the Autumn Budget the Chancellor abolished stamp duty for first time buyers purchasing a property worth up to £300,000, with buyers paying a reduced rate on properties priced up to £500,000.

The London housing market continues to display a lack of momentum in December, with dipped buyer interest, according to the December 2017 RICS UK Residential Market Survey.

Little positive impact was seen from government changes to stamp duty, with 86% of respondents saying they had seen no increase in demand due to the measures introduced in November's Budget.

After new buyer enquiries came close to stabilising in November, 15 per cent more respondents noted a decline in demand (as opposed to an increase) in the month of December.

Overall, the Northern Ireland housing market appeared to be in a more robust condition than the United Kingdom as a whole, where RICS said interest from buyers was waning.

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In contrast potential purchasers in the North displayed much more enthusiasm as new buyer enquires rose by 25 per cent and newly agreed sales by 14 per cent last month. Nationally, the majority of respondents - 66 per cent - anticipated the change having little effect, whilst only 12 per cent felt it would result in higher overall activity. Northern Ireland respondents indicated that prices here continued on an upward curve in December, and local surveyors remain amongst the most optimistic in the United Kingdom regarding the near-term price outlook.

Looking at supply, new instructions continued to decline nationally, extending a run of 23 months.

"Initial feedback from the market doesn't suggest that the change in the stamp duty regime is going to have a material impact on activity". "The risk was always that a good portion of the benefit would be capitalised in the price, therefore limit the benefit for the first-time buyer".

'Meanwhile, the latest RICS data continues to highlight the importance of disaggregating the headlines numbers when talking about the market.

Whilst sales expectations on a near-term level remain largely unchanged, the annual outlook seems more promising.

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