Will house prices drop after stamp duty increase?

[topsocks]

Will houses currently on the market have to lower their asking price because of the stamp duty increase?

I'm seeing a stuck market in SW London. There isn't a lot coming on, and what does get listed is often at an inflated price and hangs around a long time to get relisted. There are a few nice houses with sensible prices that move quickly when they appear. I suspect some off-Rightmove sales too.

Stamp duty, COL increase and uncertain job prospects, have driven the decision to staying where I am rather than try to go up the ladder. Moving would entail spending £50k+ on stamp duty and have a mortgage commitment until I retire.

@Rollercoaster1920 I'm in SW too, we probably will move again but likely move a little further out. It's not just the SD but working out how much interest I need to pay I don't want a big mortgage.

Yes and inheritance tax if applicable. Still a lot of it is recirculated to help younger people with deposits or to purchase bigger/better houses than they would otherwise be able to afford. These younger people buy the houses no longer needed by the older people and the cycle continues.

I agree that the over £10,000 figure I gave only effects a minority of FTB but the numbers won't be insignificant in London/SE/other expensive areas where 600k isn't that far above the average cost of housing. If you were to buy a property at 600k, the extra SDLT is over £11,000, as I said.

I don't agree that it doesn't tend to have a negative effect on prices. Even in your example, the 5k reduction is over 1% of purchase price. It could be more in some cases as £10,000 up front is very different to £10,000 on a 30 year mortgage. There is also a psychological effect of paying/ avoiding higher taxes. Remember how everyone rushed in with crazy bids when the SDLT holiday and very low interest rates were around only a few years ago? I could be wrong but I think it will tend to slow the market and reduce prices a bit in some areas, especially where FTB don't have the bank of mum and dad/ grandparents to draw from. Plenty of people don't have that option. However, as I said in my earlier post, imo, the greater downward pressure on prices will be the overall economy.

Buy then not by then!

I agree that SDLT is a poorly thought out tax and that taxes should be on the property itself. It's not RR being greedy though and the tax is just going up to what is was under the Tories previously, before Rishi started messing around with the not free, free markets that they supposedly support (when it suits them anyway)!

First time buyers and Landlords are both having to pay a lot more SDLT since RR disastrous budget.

I'm pretty sure the FTB and other single house owning buyer rate is just reverting to normal.
The second home buyer, including landlord rate has increased. I think the majority would agree with the latter policy though

Absolutely not.

there will likely be a dip in first time buyers looking to buy in the next few months as some rushed to complete beforehand. private sector landlords are saying they are leaving the market so there might be more homes for sale. It's difficult to know whether landlords really will sell up and not be replaced with other landlords though

Yes for <625k properties is the only correct answer.

Landlords currently say they are leaving over the Renters Reform Bill.
However coming in 2030 is the minimum EPC ‘C’ rating, for what looks like new tenancies. That will flush a lot more amateur landlords out.
Though they should be sellling up well before that, to avoid the increased competition from other LL’s getting rid of their poor housing stock.

Sellers will say no
Buyers will say yes

Wanting it(or not) will not make it so. Sellers can choose to or not.

Both sellers and buyers can choose in theory. Sellers can choose to reject offers if they don't need to sell or think they will get a better one. Buyers can choose not to make an offer or offer a lower amount to account for the tax. Judging by the number of reduced prices on Rightmove, many sellers are not getting a lot of interest even before the SDLT increase. I suspect there will be less transactions unless the government introduce something new.

Nope. People will want to buy or not. A few grand isn’t going to make a difference. The market is shit at the moment and that won’t change until interest rates come down some more.

The market is shit at the moment and that won’t change until interest rates come down some more.

They won't be coming down much