Speculation about property tax changes in the upcoming budget is fuelling uncertainty across much of the market, Rightmove data reveals.
The research found that home-movers would favour staggered stamp duty payments, while a poll of estate agents also suggested that staggered payments would be a preferable change to shifting payment to the seller.
Just under a third (30%) of homes for sale in England are priced at over £500,000, and would be subject to the proposed new annual property tax which would replace stamp duty.
Data shows that in London more than half of homes (59%) have an asking price of over £500,000 and would be subject to the rumoured annual property tax if it came in, compared to just 8% in the North East.
Rightmove says 19% of agreed property sales so far this year in England have been for homes over £500,000 but this varies regionally.
More than half (52%) of agreed property sales in London so far this year have been over £500,000, while in the North East, just 4% of agreed property sales have been for homes over £500,000 so far this year.
Mansion tax
Meanwhile, Rightmove found sales agreed for £2 million plus homes, which are the subject of a potential mansion tax, are down 13% year-on-year.
Data shows that homes priced between £500,000 and £2 million, which would be impacted by potential stamp duty changes in England, or the rumoured capital gains tax, have seen sales agreed drop by 8% year-on-year.
The under £500,000 market has been less impacted, with sales agreed down by only 4% on this time last year.
Rightmove says this mass-market sector is likely being unsettled by general Budget jitters rather than specific policy rumours.
Less than 0.5% of all homes sales agreed this year have been for properties with an asking price of over £2 million. In total, around 1% of homes for sale are priced above £2 million.
Rightmove property expert Colleen Babcock says: “Rumours of the contents of the forthcoming Budget are affecting the market, as we’re seeing a greater hesitation in sales activity, especially at the upper end, which has been the focus of most of the discussion.”
“While there is also a general unease at how the Budget may impact personal finances, the majority of home moves would be unaffected by the rumoured changes to property taxes.”
“However, we’re also seeing the uncertainty surrounding the Budget dent the confidence of some potential movers, and I think most are now fed up with the rumours and just want to see how their finances are going to be impacted.”
