Tuesday, September 2, 2008

Stamp Duty ‘Holiday’…So what

Today has made me certain, if it was ever in doubt, that there are only two 'professions' worse than estate agents. Media journalists and politicians.


That fumbling idiot today announced with great fanfare the abolition of Stamp Duty for 12 months up to the sum of £175,000. Just a few first time buyers may save themselves a few pounds but I suggest that in the main it's more of this government's 'Spin' – something it really does know how to do well.


By refusing to make a proper comment earlier in the summer he probably cost the jobs of thousands of people employed not just in the property industry but all those trades and manufacturers that follow on its train. A stalled property market was given another reason for buyers to wait and see what the great announcement would be.


So now we have the announcement only to find that hardly anyone in the UK will benefit so the delayed purchases, caused by the inept leak and fumbled comment, were all for next to nothing.


Even now that house prices have been falling for 10 months the average house price in the UK is around £185,000. The Halifax reckoned that last year's average price was £199,000 and the Nationwide maintain that prices have fallen £14,500 on average so far. These statistics make today's announcement appear very cynical indeed. So what is he giving away in order to 'kick start' the market? I don't think it actually amounts to more than a 'pat' rather than a kick.


Also let's think back to when the stamp duty threshold at £250,001 was introduced. It jumped from 1% to 3% and for ages we had buyers offering £250,000 on properties quite legitimately valued at £265,000. The same thing will happen now. Anyone with an asking price of up to £200,000 will be a target for a £175,000 bid.


And now for the media journalists. Fiona Phillips on GMTV today claimed that estate agents had been responsible for the country's booming house prices. How pathetic and muddle headed can you get. Imagine the agent who turned up at her home to provide a market appraisal and said "Yes, I know the other houses in the road have gone for lots of money but we want to exercise restraint so we don't want to put your house on for anywhere near that much". Would she show that agent the door?


Agents arrive at market assessments using comparable evidence and their knowledge of what the market will stand and buyers will pay. Her snide comment was made after a recorded film clip ended and not to someone who was able to defend their view.

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