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Economy

Stamp duty: Sellers slashing prices

Written by Gary Howes

Thursday, 04 September 2008

Effect of measures being felt in property market already.

Within a day of the Stamp Duty 'holiday' being introduced by the Treasury agents have reported seeing property prices slashed.

This is according to estate agent Marsh & Parsons.

The agents have reported that within a day of the Treasury announcing a one-year stamp duty holiday on homes worth up to £175000, vendors are already dropping prices to lure buyers keen to save themselves up to £1 750.

Yesterday the government, in an attempt to prop up the troubled housing industry, raised the threshold for Stamp Duty to the £175 000 mark - hoping to benefit those in the lower value end of the market which ultimately covers first time buyers.

Many commentators have roundly criticised the government for not accounting for the London and South East England market which does not have many properties below the threshold.

Peter Rollings, managing director of Marsh & Parsons said:

"On Wednesday morning we began to see vendors who had been asking for around £200 000 dropping asking prices to below the threshold to tempt buyers. Vendors are already adjusting their behaviour - but whether the stamp duty holiday has a direct effect on buyers remains to be seen. There aren't many £175 000 properties in London though - with the average cost of a London property close to £350 000, £175 000 properties should be snapped up."

Thomas Crabtree, Senior Sales Manager for Marsh & Parsons' Clapham office saw a property registered with him drop from £195 000 to £175 000 on Wednesday morning.

The property - a 377 sq ft studio with one reception room, a galley kitchen and a bathroom - is located on first floor of a converted Victorian house on Northbourne Road, near London's Clapham Common.

The property (which includes a share of the freehold) is within easy reach of both Clapham Common tube station and Clapham High Street train station, and is in fashionable SW4.

The seller, Clive de Rougemont said, "we thought it might have sold for around £225 000 last year but the market's come off a bit since then so we were asking for £195 000 until Tuesday. But when the Stamp Duty holiday was announced we thought we might tempt buyers after a tax bargain if we knocked another £20 000 from the asking price."