In the research firm’s weekly newsletter, Goodwin said: “We are sceptical this will deliver much additional housing market activity, with much of the tax cut likely to be capitalised into the value of the housing stock, pushing up prices.”
This week, chancellor Rishi Sunak announced the stamp duty threshold would be increased from £125,000 to £500,000 until March next year. This is expected to create an average saving of £4,500 for buyers and see nine out of ten forgo the tax completely.
The bulletin referred to Oxford Economic’s research in 2017, which followed the then-chancellor Philip Hammond’s move to provide relief for first-time buyers on property purchases up to £300,000. This concluded that as the burden of a tax holiday would fall on the seller, house prices would be pushed up by an average of 0.4 per cent.
As for other measures announced in this week’s Summer Statement, Goodwin said there were “major question marks” over the effectiveness of them and said it was hard to see how it would have a “material impact” on the growth outlook.
Other initiatives included a Job Retention Bonus and £5,000 voucher for homeowners to make environmentally friendly renovations to their home.