Stamp duty slows rise in house prices

HOUSE prices are growing at their slowest rate for five years following hikes to stamp duty and a tax raid on landlords.

Prices climbed 3.2 per cent in the year to August, according to the Office for National Statistics – the slowest rise since 2013. The average home now costs £233,000.

Experts said the slowdown was driven by repeated increases to the stamp duty paid on high-end homes.

Sam Mitchell, of online estate agent Housesimple, said: ‘This is a market that is still suffering from a supply shortage, and while buyers have the funds to purchase, the lack of properties being listed is a problem that no one seems to have the answer to.

‘We would like to see some form of incentive that encourages older homeowners to consider downsizing. The property chain isn’t all about first-time buyers – it needs to operate efficiently all the way up.

‘When you fix a chain, there’s no point just fixing one link at a time.’

The worst-performing region in the country was London, where prices dropped 0.2 per cent to £486,000. At the other end of the scale, prices in the East Midlands climbed 6.5 per cent to £195,000.

This was followed by the West Midlands (5.1 per cent) and the Yorkshire and the Humber region (3.7 per cent).

Annual house price growth of 6.2 per cent was recorded in Wales, while in Scotland the figure was 4.1 per cent. House prices in Northern Ireland increased by 4.4 per cent annually.

Nick Leeming, of estate agents Jackson-Stops, said: ‘Now Brexit is just over five months away, it will be interesting to see what is addressed in Philip Hammond’s Budget statement at the end of the month.

‘The escalating cost of moving house means some home owners are happy to stay put and renovate, and any positive reform to stamp duty could have a significant impact on this.’