TV expert Kirstie Allsopp warns Brits are ‘in a panic’ amid rumours of fresh property taxes at Rachel Reeves’ Budget – as she calls for ‘damaging’ stamp duty to be axed

Property expert Kirstie Allsopp today told MPs that Britons are ‘in a panic’ about rumoured property tax changes at Rachel Reeves‘ Budget in two weeks’ time.

The TV presenter, who fronts Location, Location, Location, warned speculation about new measures the Chancellor might bring in was having a profound impact.

Appearing before the House of Commons Treasury Committee, Allsopp also called for stamp duty to be abolished.

She argued the tax was damaging the stock of homes available for first-time buyers hoping to get on the property ladder.

Ahead of the Budget on 26 November, it has been claimed Ms Reeves is plotting a radical shake-up of property taxes.

The Chancellor is reported to have ordered Treasury officials to examine reforms to the current stamp duty system.

This could include the replacement of the levy, which is paid on the purchase of a new property, with an annual property charge. 

Allsopp described to the committee how stamp duty was currently affecting behaviour in the housing market.

Property expert Kirstie Allsopp today told MPs that Britons are ‘in a panic’ about rumoured property tax changes at Rachel Reeves ‘ Budget in two weeks’ time

Appearing before the House of Commons Treasury Committee, Allsopp also called for stamp duty to be abolished

‘What I see is young people buying more expensive houses really than they can afford because they know they can’t pay stamp duty twice,’ Allsopp said.

‘The other thing I’m seeing a lot of is people altering two and three-bed houses rather than moving, because the cost of moving is so high.

‘I think we’re actually damaging our first-time buyer housing stock because of stamp duty.’

Asked if speculation about stamp duty changes was having a pronounced impact at the moment, she added: ‘Yes, that is absolutely what I’m seeing.

‘That people are in a panic about it because it has gone up and they think it could go up again. There’s a lot of speculation in the press.’ 

Professor Tim Leunig, a director at consultancy Public First, backed up Allsopp’s case against stamp duty.

‘Under Help to Buy, the most common-sized property bought by first-time buyers had three bedrooms,’ he said.

‘And that’s just plain weird, because a three-bedroom house, particularly a new three bedroom house, is usually quite an expensive proposition.

‘And people are doing that because then they only then have to pay stamp duty once and they only have to buy it on the first-time buyer rate.

‘One of the big problems of the first-time buyer lower rate is it discourages you from buying a cheap first-time buyer property because you don’t get much benefit, and you lose the right to the benefit later.’

Richard Donnell, executive director at Zoopla, told the committee that 40 per cent of first-time buyers looking to buy property through his website would pay stamp duty.

‘That’s up to nearly 80 per cent of first-time buyers in London,’ he added. ‘It’s a tax that leans really heavily on London and the South East.

‘I think what concerns me most, if you look at sales for over £500,000, it’s 70 per cent of the receipts. Sales over £1million is 40 per cent of the receipts.’

Mr Donnell said the number of homes being sold ‘does have a multiplier effect for the economy’.

‘So you can see it has an impact on white goods, spend, getting people to do DIY on your property, improving your property,’ he continued.

‘So in a market where people aren’t moving as often, that drives less economic impact.’

He said many people in southern England were looking to move out of their local area.

Stamp duty applies in England and Northern Ireland, with separate taxes in Scotland and Wales.