In the government’s mini-budget set to be announced tomorrow, New Prime Minister Liz Truss is rumoured to announce radical plans to cut stamp duty in an attempt to bolster economic growth, encourage movement and thus aid first-time buyers struggling to get on to the property ladder. 

More recent SDLT cuts (for example during the pandemic) have had the effect of supporting a stalling market and boosting sales at a difficult economic time. It remains to be seen whether this will have the effect of kick starting a slowing property market given the wider economic factors currently in play. Inflation is growing at the fastest level in 40 years and interest rates are predicted to continue rising in the coming year, all set against a weak GDP figure and the strong likelihood of the UK entering into a recession. 

We are currently seeing less activity than normal in our core market sector and it may be that the tax saving alone is not sufficient to entice buyers back to the market in a very uncertain economic climate. We are continuing to see more activity at the higher end of the market, where transactions are fully cash or less dependent on leverage, and particularly where international buyers are taking advantage of the weak sterling rate. We would expect such transactions to continue, or potentially increase, given a possibly larger tax saving through any SDLT cuts.