Stamp duty up – but set to look more downtrodden

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, comments on the publication of the HMRC quarterly stamp duty data, showing stamp duty up – but set to look more downtrodden.

Key points from publication:
    • Residential property receipts in Q4 2022 were 12% lower than Q3 2022, and 4% higher than Q4 2021.
    • This fall coincides with the increase in the nil rate threshold and First Time Buyers’ Relief threshold in September 2022.
    • The number of residential property transactions in Q4 2022 was 4% higher than in Q3 2022, and 8% higher than in Q4 2021.
    • 52,600 transactions were liable for higher rates of stamp duty – an 18% fall from Q4 2021.
    • Total stamp duty receipts (residential and business) in Q4 2022 were 10% lower than in Q3 2022 and 5% lower than Q4 2021.
Helen Morrissey says:

“Stamp duty is likely to look decidedly more downtrodden in the coming months. 

“This data covers transactions likely agreed in the late summer/early Autumn, so they won’t demonstrate the full impact of the mini-Budget which sent many would-be buyers running for the hills as lenders pulled deals from the market at the very last minute.

“As a result, receipts for stamp duty for residential properties were still higher than the same period the previous year as were the number of transactions.

“It depicts a very different market to the one we are facing now just a few short months later.

“Make no mistake the property market is slowing down. In the intervening months annual house price increases have slowed and the number of transactions is coming down.

“Soaring bills and the looming prospect of recession mean many people need to shelve their home buying dreams for now.

“The number of transactions liable for higher rates of stamp duty including buy to lets and second homes has already come down significantly in a sign of people’s nervousness about the direction of the market and we will see this seep into the wider residential figures in the coming months.”

 

Kindly shared by Hargreaves Lansdown

Main article photo courtesy of Pixabay