The £3.8bn stamp duty giveaway unveiled by chancellor Rishi Sunak last week has already sparked a mini property boom in the southern England commuter belt, according to the UK’s biggest property website, Rightmove.
The data indicates that most of the benefit of the £3.8bn giveaway will flow to Conservative-voting areas in the outer orbit of London.
Rightmove named Milton Keynes, Watford and the north-west London borough of Harrow as the areas witnessing rises of more than 100% in buyer enquiries since the stamp duty announcement was made last Wednesday.
The biggest surge in activity has been in homes priced between £400,000 and £500,000, where the benefit of the stamp duty cut is highest. Rightmove said that, across England, there has been a 49% increase in buyer enquiries for properties in this price bracket, compared with an increase of just 1% for properties valued at £300,000 or less.
Under Sunak’s stamp duty cuts in England, buyers of homes up to a value of £500,000 will pay no stamp duty, with a reduced rate for homes above that. For someone buying a £500,000 home, the saving is worth £15,000.
“We’re busier than ever,” said Joe Frost, of Milton Keynes estate agency Alan Francis. “It has been incredibly buoyant since the stamp duty announcement. We had one person complete the day after and save £15,000 so they were very happy. It also means people are keeping their prices firm – prices are perhaps not as negotiable as they were before.”
Rightmove said the top ten areas with the biggest jumps in searches – including Chelmsford, Swindon and Bromley – are all in outer London boroughs and southern England, with an average asking price just under the £500,000 threshold.
Miles Shipside, Rightmove director, said: “The uplift in enquiries is likely a mixture of people looking in new areas to see what they can now afford, changing their search criteria to bigger, slightly more expensive homes, and new movers coming into the market because they now have enough extra budget to move home.
“The savings of £15,000 on property above £500,000 may also help some people to trade up more easily. Our analysis shows that this is going to help the mid-market the most.”
Rightmove collects data on two different bases: the number of buyer enquiries, where someone phones or emails an agent through the site about a property; and searches, where someone is simply typing the area into the site to look at properties.
Milton Keynes led the increase in buyer enquiries, up 136% for properties priced between £400,000 and £500,000. But for searches only, the biggest increases have been in Borehamwood, Hertfordshire (up 41%) and Caterham in Surrey (up 38%).
There are also fears of a surge in buy-to-let activity by landlords at a time when first-time buyers are struggling to obtain loans in the wake of the Covid-19 crisis.