Purplebricks has announced its support of Conservative proposals to reform Stamp Duty, claiming it would create an “economic ripple effect of a buoyant housing market”.
Research conducted by the agency revealed that 131,000 more house moves would be completed in the coming year if the stamp duty threshold was increased to £500,000.
Movers would pay 63% less stamp duty, and there would be no payable duty for nine out of 10 home purchases. Research also predicted movers would spend £473m more on home improvements after reform.
It said that whilst the government would lose £3.2 bn in stamp duty revenue, there would be a rise in moving spend, VAT and other tax receipts that would consequently generate £1.2b n.
It said: “The overall lift to economic growth and government revenues would not be confined to direct spending generated by the rise in property transactions as there would be a multiplier effect across the economy.
“The rise in revenues received by conveyancers, surveyors, retailers, builders etc would boost their spending which in turn would lift spending in other parts of the economy.”
Purplebricks also claim the economy would receive a £1.7bn direct boost from move related spending, including revenue from conveyancing fees, property surveys, estate agency fees, removal costs, decorating and home furnishings.
Stamp duty reform, they claim, would give an estimated overall boost of £6.2bn to the UK economy.
Purplebricks’ support comes in light of recent Conservative proposals to increase the stamp duty threshold for residential properties from £125,000 to £500,000, and cutting the top rate from 12% to 7%.
Although these claims were supported by Boris Johnson on the campaign trail, as of yet there has been “little evidence of government intervention”. However, these claims signal that reform could be “firmly back on the political agenda” ahead of the release of party manifestos next week.
Vic Darvey, CEO of Purplebricks, said: “Reforming Stamp Duty is the key to unlocking growth and getting Britain moving. These proposals will kick start both the UK property market and the wider economy.
“This could help growing families move into bigger properties, make downsizing much more appealing for empty nesters and help first time buyers get a foot on the property ladder.”