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Now that Boris Johnson has been announced as the new PM in a convincing victory over his rival for the Tory leadership, the property industry has been commenting on what changes they expect.
The announcement of the new PM was made yesterday, where Boris Johnson won 92,153 votes against the 46,656 captured by Jeremy Hunt. Though the election was primarily for the leadership of the Conservative Party, Boris will now replace Theresa May as PM today.
Upon winning the race to become PM, Johnson said: ‘We are going to energize the country, we are going to get Brexit done by October 31st, we’re going to take advantage of all the opportunities it will bring in a new spirit of can-do, and we are once again going to believe in ourselves and what we can achieve.’
Shaun Church, Director at Private Finance commented: ‘Brexit will be top of Boris Johnson’s to-do list, but other crucial issues facing the domestic agenda must not be overlooked – one of which is the UK property market. Activity in the housing market is falling and in desperate need of a stimulus. Rumours of a stamp duty overhaul have been circulating for some time now and we urge Johnson to make these rumours a reality and re-galvanise the property market, which is after all a crucial asset of the UK economy.’
Jonathan Sealey, CEO at Hope Capital, added: ‘It is at least positive to have a new PM in order to end the uncertainty about who will be leading the country and negotiating Brexit in its final stages.
‘If his promises are kept, we will be exiting the EU by 31st October, meaning the end of this unstable and uncertain period we’re currently in.
‘Lenders and borrowers will benefit from the end of an extended period of change and uncertainty, which should lead to borrowers having the confidence to make the purchases and investments they may have been putting off until now.’
Boris Johnson indicated plans to reduce ‘absurdly high’ stamp duty if he became PM, which could help first-time buyers get on the ladder and invigorate the prime London market.
He made a bold promise to abandon all levies on properties valued at under £500,000. The new PM also said he intends to lower the top rate of stamp duty tax on the most expensive properties (valued over £1.5m) from 12 to 7 per cent.
Robert Nichols, CEO of London estate agents Portico, said: ‘It’s no secret that stamp duty hampers household mobility – and the higher the tax, the more difficult it is for people to move and keep the market moving.
We saw the market go into standstill when George Osborne hiked up stamp duty for homes valued at £925,000 or more in 2014. There was a huge spike in volume as investors and second-home buyers rushed to buy properties before the stamp duty changes came into effect in April. But as quickly as volumes went up, they came down again – dramatically – and in Westminster, prime central London, we saw volumes drop to below 100 transactions in a month to a record low of 84.
If Boris Johnson does reduce stamp duty, it would certainly invigorate the top end of the property market and we should see transactions increase.’