In its latest market commentary, the firm suggested that a stamp duty holiday now would be more impactful than the holiday introduced in the early stages of the pandemic.
Knight Frank noted that property transaction levels were actually strong despite the successive lockdowns, as despite the restrictions, people were keen to move to properties which better met their needs.
However, with demand for property now being limited by various economic factors, Knight Frank suggested that a stamp duty incentive would counteract that and push transactions back up.
Tom Bill, head of UK residential research at Knight Frank, noted that current mortgage approval levels are a third below the five-year average, while transaction levels are down by around a quarter.
He pointed out that with the benefit of hindsight, a stamp duty holiday was not needed in 2020, yet “some form of UK-wide support would certainly be welcome now”.
He continued: “Unlike the early months of Covid or the period following the mini-Budget, there is no single cause of the slowdown. Sentiment has been affected by a series of factors including the financial pain of higher mortgage rates, the Bank of England’s struggle to contain inflation, the impending general election, and uncertainty arising from overseas military conflicts.”
