- A study commissioned by Spring suggests stamp duty reform could increase UK housing transactions by up to 178 per cent annually.
- Researchers estimate around 168,000 additional home sales could take place each year under a full SDLT exemption for corporate property traders.
- Nearly 30 per cent of agreed property sales collapsed in 2024, with taxes and stalled chains continuing to weigh on the market.
Britain’s housing market could see a sharp rise in property transactions if the government reforms stamp duty rules for corporate property traders, according to new research that argues the current tax system is slowing movement across the sector.
The study, commissioned by national home buying company Spring and carried out by Volterra, found that removing the Higher Rate for Additional Dwellings surcharge for corporate traders could generate as many as 168,000 extra property sales each year.
The findings arrive at a time when the UK housing market continues to struggle with stalled transactions, failed property chains and affordability pressures, while policymakers remain under pressure to improve housing supply and market activity.
Under current rules, property traders who temporarily purchase homes to help complete housing chains are charged the same additional stamp duty rates as second-home buyers and portfolio landlords. The surcharge adds five percentage points to stamp duty bills on most second-hand property purchases.
The tax slowing down the housing chain
According to the report, stamp duty is increasingly acting as a brake on housing mobility rather than simply a source of government revenue.
The modelling reportedly found that every 1 per cent increase in Stamp Duty Land Tax reduces annual transaction volumes by roughly 3.5 per cent. That impact stretches across the market, affecting families looking for larger homes, older homeowners planning to downsize and workers relocating for jobs.
The study also pointed to rising instability in housing chains. Data cited in the report showed that around 30 per cent of agreed property sales collapsed in 2024, often leaving buyers and sellers facing thousands of pounds in legal fees, surveys and moving costs.
While some stamp duty relief already exists for traders buying new-build homes, most second-hand property purchases still attract the full Higher Rate for Additional Dwellings charge.
Researchers argued that removing or reducing the surcharge for corporate traders could improve market liquidity by helping transactions move faster through stalled chains.
Calls grow for wider housing market reform
Shane Miller-Bourke reportedly said planning reform alone would not be enough to meet the UK’s housing delivery targets, adding that stronger market liquidity would also be necessary.
He reportedly argued that reforming SDLT rules could help improve movement across the housing sector, particularly at a time when transaction volumes remain under pressure despite continued demand for homes.
The debate around stamp duty has intensified in recent years as policymakers, tax professionals and property firms weigh the balance between government revenue and housing market efficiency.
The report stops short of predicting whether the government will introduce changes, but it adds to growing industry calls for a rethink of transaction taxes as the UK property market continues adjusting to higher borrowing costs and slower deal activity.
