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Stamp duty and downsizing

Journalist: Melissa Lawford, The Telegraph

ended 22. December 2022

To what extent is stamp duty a major deterrent for downsizers? Why is it a problem for them, when they will be making a profit from the sale of their original home? Do you think people are downsizing more slowly because stamp duty bills have climbed disproportionately to house prices? If the Government cut stamp duty for downsizers, would it encourage more people to free up large family homes?

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Justin Moy
Managing Director at EHF Mortgages
The general cost of buying and selling property, whether downsizing or moving up the property ladder, is never easy to stomach, but given the level of property inflation over the last 10 or so years, we should be thankful there is no capital gains tax on the sale...

Other ways to fund lifestyles for those typical downsizers include Equity Release, which has had an intense few years of growth whilst rates were relatively low, which has probably contributed to this slowdown.

If any Stamp Duty cuts were implemented for downsizing, there inevitably would be many happy to take advantage of any saving of tax. But I don't foresee a huge change in activity at the moment, market forces might change that dynamic, especially if we have a shortage of larger family homes across the country.