London house sales take a battering from sky-high stamp duty, with just 70 central properties being sold a week
- Home sales in the heart of the capital are down 16.8 per cent on a year earlier
- There are now fewer homes selling than at the height of the financial crisis
- A rumoured tax on foreign property owners could make the problem even worse
House sales in central London have dived to a record low as buyers are put off by sky-high stamp duty.
Just 70 properties are being sold each week in the heart of the capital, according to analysis by investment firm London Central Portfolio – down 16.8 per cent on a year earlier.
There are now fewer homes selling than at the height of the financial crisis in 2009.
House sales in central London have dived to a record low as buyers are put off by sky-high stamp duty
Experts blamed steep hikes to stamp duty for putting off buyers, who are unwilling to fork out hundreds of thousands of pounds in tax.
It is feared the slowdown will cause problems for the whole market.
If families at the top of the ladder are unable to move because of the tax, then people further down cannot climb up a rung.
Ultimately it means there are fewer homes on the market for first-time buyers.
Naomi Heaton, chief executive of LCP, said a rumoured tax on foreign property owners could make the problem even worse.
‘This does not seem to be the right message for the Government to be sending to the outside world with Brexit looming,’ she said.
Defying Brexit fears
Average property prices have risen by 9 per cent since the Brexit vote – defying gloomy forecasts during the Project Fear campaign.
The Treasury warned before the European Union referendum that prices would be 18 per cent lower after a vote to Leave.
Dubbed the Dossier Of Doom, Treasury officials also claimed that demand for housing would drop because lending costs would rise.
But a study by estate agent Haart found that, instead, average prices are up 9pc.
Paul Smith, chief executive of Haart, said: ‘EU or no EU, the need to move home will always be there.’
‘It flies in the face of the ‘open for business’ slogan the Prime Minister previously used at the G20 summit in 2016.’
The average property price in Westminster and Kensington & Chelsea stands at £1.9 million, up 4.9 per cent on a year earlier. But there were just 3,606 houses sold in the 12 months to September 30, or 70 a week. This is lower than the depths plumbed in 2009, when 3,704 properties were sold.
The figure of 70 a week is down 45 per cent on 2014 when the market was booming.
But the then-chancellor George Osborne hiked stamp duty on expensive properties, pushing up the cost for anyone buying a house worth more than £937,500.
While those buying a £275,000 house saw their stamp duty fall by £4,500 to £3,750, the levy on a £1.5 million property jumped by £18,750 to £93,750.