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Stamp duty cut ‘hasn’t helped first-time buyers’

Written by: Lana Clements
The stamp duty cut for first-time buyers has failed to give the UK housing market an immediate boost, according to the Royal Institution of Chartered Surveyors (RICS).

Almost nine out of 10 surveyors reported no response from first-time buyers in December, after the government slashed liability for stamp duty by up to £5,000 at the end of November.

On the contrary, buyer interest edged lower with sales and new instructions sliding at the end of last year, the RICS survey found.

Around 15% more surveyors noted falling demand in December from November, at the same time 13% more reported a decline in transactions.

RICS said the poor figures could in part be down to the time of year, while prospects for sales and demand over the coming 12 months were better – with activity expected to pick up.

However, two out of three respondents did not expect the stamp duty cut to make a significant difference to the market in 2018.

Prices up slightly

House prices were recorded as a marginal increase in line with other measures, while tenant demand was reported as falling in December.

Brian Murphy, head of lending for Mortgage Advice Bureau (MAB), said“The report issued by the RICS today is based on the results of a sentiment and opinions based survey, rather than hard data, which provides us with an insight into how surveyors have observed the current market over the last month in their local area, and their expectations both in the shorter and longer-term.

“It would appear that surveyors in many areas observed a seasonal slow-down in the market in December, with the lead up to Christmas and holidays having their normal impact on activity levels, which is of course within normal expectations and nothing to worry about.

“Some suggest that this may also lead to a sluggish start to the New Year, however it would appear that this hasn’t been the case across the whole of the country, with some areas bucking the trend last month and seeing transaction levels and pricing remain strong.”

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