UK property experts are calling for a radical overhaul of stamp duty charges to boost sales by as many as 168,000 annually. The proposed reform aims to alleviate a significant barrier to transactions in the form of the Higher Rate for Additional Dwellings (HRAD) surcharge – currently levied on corporate entities buying additional residential properties.
The study suggests that removing this extra levy specifically for companies could lead to an increase of up to 178% more property sales each year. This change is seen as a way to alleviate the pressure on corporate traders and allow them to invest in the market without being deterred by the surcharge, which was introduced to cool the buy-to-let sector and give first-time buyers a fairer chance.
However, critics have long argued that the HRAD surcharge has had an unintended consequence – reducing the number of available properties on the market. This could ultimately impact housing supply, making it harder for renters to find suitable homes. By removing the additional levy for corporate entities, the research suggests that policymakers may be able to strike a better balance between supporting first-time buyers and promoting investment in the rental sector.
A significant increase of 168,000 sales annually would inject much-needed activity into a market affected by economic uncertainty and interest rate changes. This boost could benefit various sectors, including estate agents, conveyancers, construction companies, and home improvement industries.
While the study's findings are promising, any proposed changes to stamp duty would undoubtedly spark debate among policymakers. They would need to weigh the potential benefits against concerns about affordability for individual buyers and the original intent behind the HRAD surcharge. Further details on the institution behind the research and whether it has been peer-reviewed would be essential for a comprehensive assessment of the study's findings.