Mini-boom in house prices as stamp duty freeze heats up market

THE stamp duty holiday has caused a “mini-boom” in house prices, estate agents have claimed, as they urged the Government to “consider” making the changes permanent. Since the changes came into force on July 8, the number of offers accepted on properties has jumped. Knight Frank found that for properties valued under £1.5 million, the number of deals closed were 146 per cent above the five-year average.

Meanwhile, the number of new prospective buyers registering to purchase properties under £1.5million was 100 per cent higher. Last month, Rishi Sunak

announced that stamp duty would be suspended in England and Northern Ireland on purchases of up to £500,000 until March next year.

The freeze has provided an “additional boost” to the housing market, Knight Frank claims, adding: “The holiday, it must be concluded, is working.” However, it warned that job cuts and concerns of redundancies creating an immobile labour force “could prove counterproductive” to the market.

Whether the changes should be made permanent is “something the Government should consider”, it urged.

House prices have leapt to a new high in July, in a “surprising spike” after the market was put on pause earlier this year. Property values jumped by 1.6 per cent from a month earlier, according to the Halifax.

Across the UK, the average property value was £241,604 in July, up from £237,834 in June.

Russell Galley, managing director at Halifax, said: “As pent-up demand from the period of lockdown is released into a largely open housing market, a low supply of available homes is helping to exert upwards pressure on house prices.”

Miles Robinson, the head of mortgages at Trussle, the online broker, said that “time will tell” whether the recovery is a long-term trend or a “mini-boom”.