London Central Portfolio states that central London's property market is recovering following stamp duty increases.
The Central London property market - both the 'mainstream' and 'premium' - is showing signs of recovery following stamp duty increases in recent years.
According to the London Central Portfolio, the prime market or 'premium sector' has seen growth of 7.0% over the last year.
Stamp duty was increased in 2014 and then again in 2016. From April 2016, stamp duty rates for buyers of second properties increased by 3%. If the property is deemed not your main residence, then the extra 3% surcharge needs to be paid, so this is relevant to holiday homes and buy-to-let properties.
The successive rises to stamp duty have particularly affected the prime London market, slowing activity and the number of sales transactions generally.
Chief Executive of London Central Portfolio, Naomi Heaton, said: "We have now seen signs of recovery as buyers absorb the additional cost of investing into a world class, safe haven asset class. Brexit jitters also appear to be calming down as global political and economic uncertainty makes the UK an attractive place to invest in once more".
Heaton continued: "Whilst there may be further volatility to come, particularly with the Autumn Budget on November 22, these findings are certainly encouraging."
There is speculation that Chancellor Philip Hammond will offer a lifeline to first-time buyers by cutting stamp duty for first-time buyers in the Autumn Budget later this month. Stamp duty for first-time buyers in London in particular has proved a hindrance to many trying to step onto the property ladder. But as the market remains 'delicate' it remains to be seen whether any further changes to taxation will have a positive or negative impact.
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