Hello readers,

I have been at the Propertymark conference this week and one topic of conversation was the Conservative’s surprise policy proposal to abolish stamp duty. I thought I would put together some notes and share my thoughts as it’s a big (potential) headline for property investors.

Before getting into the proposal, I thought I would share with you that, at the conference, I was delighted to receive my Propertymark fellowship from along with Home Share’s Branch Manager Crystal!

This qualifications is equivalent to one year of university degree, with Crystal and I having put a lot of work into studying and completing exams for it so it’s really positive to see this result. Emma in the Home Share office is also completing this qualification. We are very proud to be accredited by Propertymark and members with them as it shows our dedication to learning and being experts in our field.

So, onto the headlines and discussion about abolishing stamp duty!

When first looking into this, read about how the first consideration was to move the thresholds but it was decided not to do that. Certainly, stamp duty is a significant cost for homeowners (and investors), so abolishing it will provide significant stimulus to the housing market (such as we saw during COVID-19). Whilst this may be the case, we obviously have several years to the next election and therefore this policy could become irrelevant depending on how the landscape changes!

I initially got quite excited for property investors when reading this headline, but when looking more into the press release, I discovered that it would only apply to primary residencies, so not additional homes, those purchased by companies or non UK-residents.

This is good news for property investors however, as I fully anticipate that dropping stamp duty will fuel demand and push up house prices. Of course, this would be great for those who currently own a property, but perhaps not so good for those who don’t. For example, between January 2020 and December 2022 UK house prices increased by 20.4% or £48,620 on average.

With labour pushed up against a wall by their own promise not to raise certain taxes we might see some them tweak stamp duty in the November budget.

Here are two things I have read might be included – let’s see what happens here:

• Replacing stamp duty and council tax with a new “proportional” property tax
• Increasing existing stamp duty rates (perhaps for those purchasing additional properties)

The problem with this policy is that if stamp duty is removed, the money to backfill it will need to be found elsewhere (which will certainly be unpopular) – I have read that this could be as much as £9bn per year by 2029-30.

Let’s see what happens over the next 6-12 months before getting too excited. My personal opinion is that this policy proposal is more to make the Tories stand out and challenge the tax rises we all fear might happen in November!

I’d be interested to hear your thoughts – do drop me an email on hasan@home-share.co.uk.

Hasan