The legacy of George Osborne – gone but hard to forget

With the blame for the downturn in high-end property sales being placed firmly on the shoulders of the Brexit vote, many are starting to point towards Osborne’s tax increases as the root of the problem.

In the wake of the recent slowdown in the high-end property market, many property selling experts originally believed much of the discontent felt by both vendors and potential homeowners was due to the Brexit vote.

Osborne himself, before being sacked from the cabinet by new Prime Minister Theresa May, stated that a Brexit vote would “hammer the housing market and the wider economy”. But as the market stabilises in the wake of the June referendum, it is slowly becoming clear that much of the anxiety felt within the property market in both London and the rest of the UK stems from tax hikes introduced by the man himself.

The clampdown on stamp duty started in December 2014, when Mr Osborne introduced legislation that made the purchase of any house worth more than £937,500 even more expensive than it was previously – a decision that impacted the capital more than anywhere else due to its high prices and competitive market. While the issue is focused on more expensive homes, the effects have started to trickle down to those further down on the property ladder. His second assault on the market targeted second-home owners and landlords, who suffered at the hands of a further 3% stamp duty hike in April this year.

Many experts within the industry have started to decry the notion that the current troubles being experienced are due to the Brexit vote, but rather a result of the tax increases by the former chancellor.

“That [the slowdown of expensive home sales] is nothing to do with Brexit, it is all to do with stamp duty which has been really hiked over the last few years,” said Steve Morgan, chairman of housing developer Redrow Homes, who also claims that sales for new-build home in the months since the referendum are 8% higher than the previous year – dispelling the myth that the referendum has led to a downturn across the entire market.

Tony Pidgley, founder and chairman of the Berkeley Group echoed Morgan’s sentiment, declaring that taxes across the whole country are “too high” – and could lead to further stagnation down the road as consumer confidence drops and over-cautious buyers decide to hold off on new home purchases.

For vendors who are desperate to sell fast, this news will not be welcome, as it is likely to increase the length of time that their properties will take to sell. While they can always use property buying companies who buy any home for cash at competitive prices, many will remain highly critical of the market for some time to come.

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