winkie Posted November 23, 2017 Share Posted November 23, 2017 The whole point of all this rightly or wrongly is to make people think they are being helped.....help people who think buying their own home will be good for their future, but also a knock-on good for the economy's future finances....... to 'so call' help begin the process of buying their own home......those who are already buying are not the priority, they already have one, whether what they have will be suitable for their future needs or not......once on the ladder a greater chance on remaining on the first rung at the moment, without help. Quote Link to comment Share on other sites More sharing options...
deadasadodo Posted November 23, 2017 Share Posted November 23, 2017 It will unleash a load of new buyers onto the market, and the increaced competition will drive up prices (or stop them from falling as much). I'm sure this is pretty much what the Government wants to happen, i.e. keep prices high by adding more fuel to the fire. For a lot of people the initial cash outlay of deposit, legal fees and stamp duty will be the factor preventing them from buying a house - there's plenty of couples with 30k + jobs that can get a fairly sizeable mortgage. Removing stamp duty drops the bar, so people who couldn't buy on Tuesday will be able to now. Call me paranoid, but letting people know that this is likely to raise prices might be part of the strategy. Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 Just now, BuyToLeech said: It would have lowered them, but how do you separate out the effect of the tax from the generally rising market at that time?  I don't know if that change has been analysed, but other changes have, and the result is not in doubt. It's all been posted before. Use google. Normally when people say there is lots of evidence they post it rather than ask others to google it for them. The only evidence anyone has posted in this thread shows that this a stamp duty holiday does not affect prices. Of course even if (which has not been shown) stamp duty does not make life easier for FTBs, it makes it a lot easier if they ever want to move. Do you really want people to able to buy and never able to move again? Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 I did use google and the top hit for stamp duty incidence is http://eprints.lse.ac.uk/59637/1/Besley_Incidence transaction_2016.pdf Which says Quote We cali-brate these findings to a bargaining model and show this implies that about sixty percent of the surplus generated by the holiday accrued to buyers. Â Quote Link to comment Share on other sites More sharing options...
BorrowToLeech Posted November 23, 2017 Share Posted November 23, 2017 8 minutes ago, iamnumerate said: Normally when people say there is lots of evidence they post it rather than ask others to google it for them. The only evidence anyone has posted in this thread shows that this a stamp duty holiday does not affect prices. Of course even if (which has not been shown) stamp duty does not make life easier for FTBs, it makes it a lot easier if they ever want to move. Do you really want people to able to buy and never able to move again? The evidence has been posted elsewhere, many times, and I'm too busy to repost it. Evidence from the last stamp duty holiday was that yes, prices rose. And this is not a temporary suspension. Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 Just now, BuyToLeech said: The evidence has been posted elsewhere, many times, and I'm too busy to repost it. Evidence from the last stamp duty holiday was that yes, prices rose. And this is not a temporary suspension. Please see my above post, yes prices rose but 60% of the gain went to the buyers. Quote Link to comment Share on other sites More sharing options...
Andy T Posted November 23, 2017 Share Posted November 23, 2017 12 hours ago, guest_northshore said: "The costing of this measure uses recent mortgage data on FTBs. The proportion of FTBs in all new mortgage lending recently jumped from around 40 to over 45 per cent of all mortgages. This coincided with the introduction of the SDLT surcharge on additional property purchases in April 2016."http://budgetresponsibility.org.uk/box/a-new-tax-relief-for-first-time-buyers/  Really surprised it was as high as 40/45 percent... with transaction volumes being so low - must include First Time BTLers? From Gov's point of view, you could say there's not much of problem with first time buyers. Seems more likely they've done it for a general bump start for the whole market to get transactions up, and/or price increases. Quote Link to comment Share on other sites More sharing options...
guest_northshore Posted November 23, 2017 Share Posted November 23, 2017 41 minutes ago, Andy T said: Really surprised it was as high as 40/45 percent... with transaction volumes being so low - must include First Time BTLers? From Gov's point of view, you could say there's not much of problem with first time buyers. Seems more likely they've done it for a general bump start for the whole market to get transactions up, and/or price increases. So was I. Halifax estimate 47% FTB, up from 37% in 2006 H1. I'd assume that excludes BTL mortgages, but don't know.https://www.halifax.co.uk/media-centre/house-price-index/ - 'First Time Buyer Review' Quote Link to comment Share on other sites More sharing options...
guest_northshore Posted November 23, 2017 Share Posted November 23, 2017 2 hours ago, iamnumerate said: Normally when people say there is lots of evidence they post it rather than ask others to google it for them. The only evidence anyone has posted in this thread shows that this a stamp duty holiday does not affect prices. Of course even if (which has not been shown) stamp duty does not make life easier for FTBs, it makes it a lot easier if they ever want to move. Do you really want people to able to buy and never able to move again? Best & Kleven (2015)http://www.henrikkleven.com/uploads/3/7/3/1/37310663/best-kleven_landnotches_feb2015.pdf Davidoff and Leigh (2013)http://ftp.iza.org/dp7463.pdf Kopczuk & Munroe (2012)http://www.nber.org/papers/w20084 Dachis at al (2012)https://www.researchgate.net/publication/228449122_The_Effects_of_Land_Transfer_Taxes_on_Real_Estate_Markets_Evidence_From_a_Natural_Experiment_in_Toronto etc Quote Link to comment Share on other sites More sharing options...
PropertyMania Posted November 23, 2017 Share Posted November 23, 2017 We're forgetting that higher prices also mean more sellers coming into the market, pushing down prices. A simple tax wedge diagram suggests scrapping SD will 50% gain the buyer and 50% the seller. The only losers in this instance are people who sold out of the housing market before yesterday and now want to get back in. Quote Link to comment Share on other sites More sharing options...
Greg Bowman Posted November 23, 2017 Share Posted November 23, 2017 13 minutes ago, PropertyMania said: We're forgetting that higher prices also mean more sellers coming into the market, pushing down prices. A simple tax wedge diagram suggests scrapping SD will 50% gain the buyer and 50% the seller. The only losers in this instance are people who sold out of the housing market before yesterday and now want to get back in. Genuine question I 'sold out' at what I think is peak for my area in July and renting because no stock to down size to of what I considered value. How am I worse off if I sold for more than I would get now and my next purchase you believe will be cheaper ? Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 25 minutes ago, guest_northshore said: Best & Kleven (2015)http://www.henrikkleven.com/uploads/3/7/3/1/37310663/best-kleven_landnotches_feb2015.pdf Davidoff and Leigh (2013)http://ftp.iza.org/dp7463.pdf Kopczuk & Munroe (2012)http://www.nber.org/papers/w20084 Dachis at al (2012)https://www.researchgate.net/publication/228449122_The_Effects_of_Land_Transfer_Taxes_on_Real_Estate_Markets_Evidence_From_a_Natural_Experiment_in_Toronto etc Thanks for that, did you look at my link? Your first one says Quote Our data show that Toronto's 1.1% tax caused a 15% decline in the number of sales and a decline in housing prices about equal to the tax. Relative to an equivalent property tax, the associated welfare loss is substantial, about $1 for every $8 in tax revenue. The magnitude of this welfare loss is comparable to those associated with better known interventions in the housing market. Unlike many possible tax reforms, eliminating existing LTTs in favour of revenue equivalent property taxes appears straightforward Why do you think less property sales is desirable? This link says a) SDLT (or the Toronto equivalent) makes house prices higher b')But it is a bad thing because it causes welfare losses  Even proof that shows that FTB do not lose a penny because of stamp duty would not make me like it, because I want FTBs to be able to move From the New statesman https://www.newstatesman.com/economics/2013/08/high-stamp-duty-lowers-house-prices  Quote There's few for whom that's good news – though if you don't yet own a house and plan to buy one and never sell it, it won't hurt. A lot of people have to move, why should they have to pay more than those who don't? (BTW I hate moving and probably will never be affected, unless I come into a windfall in which case I wouldn't mind or have a disaster in which case I would) Quote Link to comment Share on other sites More sharing options...
guest_northshore Posted November 23, 2017 Share Posted November 23, 2017 6 minutes ago, iamnumerate said: Even proof that shows that ... A lot of people have to move, why should they have to pay more than those who don't? (BTW I hate moving and probably will never be affected, unless I come into a windfall in which case I wouldn't mind or have a disaster in which case I would) Then stop going off on tangents & start a thread about sales or mobility. This is about prices. Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 Just now, guest_northshore said: Then stop going off on tangents & start a thread about sales or mobility. This is about prices. Well there are papers saying that it does affect prices, the first result on google says that. As I looked at your link did you look at mine? I also believe that more sales would make the market more liquid and less likely to be unstable. (Admittedly about 20 years too late). Do you think it is a good thing? If so why post links that say it is not. Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 PS I apologise when I said your first one, I should have said your last one. Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 5 minutes ago, guest_northshore said: Then stop going off on tangents & start a thread about sales or mobility. This is about prices. I do find your links very interesting thanks again. This one http://ftp.iza.org/dp7463.pdf Quote Supply side factors have also been a significant contributing factor. Over the period in question, supply of housing in Australia has remained relatively static.For example, the number of homes completed in Australia was constant at around 100,000 per year throughout the 1990s and 2000s (ABS 2012a), despite the population increasing by nearly one-third during that period. Thinks that the problem is lack of supply of houses. Quote Link to comment Share on other sites More sharing options...
guest_northshore Posted November 23, 2017 Share Posted November 23, 2017 1 minute ago, iamnumerate said: Well there are papers saying that it does affect prices, the first result on google says that. As I looked at your link did you look at mine? I also believe that more sales would make the market more liquid and less likely to be unstable. (Admittedly about 20 years too late). Do you think it is a good thing? If so why post links that say it is not. The first one is specifically about UK SDLT and finds significant leverage impact ignored by most studies, including the one you repeatedly cite while ignoring everything else. You're a homeowner who doesn't like land transaction taxes. Not terribly surprising but fair enough. But that's of zero relevance to whether changes in SDLT affect prices. Particularly whether changes in FTB SDLT screws FTBs. Supply - another tangent for another thread. Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 1 hour ago, guest_northshore said: So was I. Halifax estimate 47% FTB, up from 37% in 2006 H1. I'd assume that excludes BTL mortgages, but don't know.https://www.halifax.co.uk/media-centre/house-price-index/ - 'First Time Buyer Review' Although the number of FTB has dropped in absolute terms (from your link) Quote The number of first-timebuyers (FTBs) reached an estimated 162,704 in the first six months of 2017 , only 15% below the peak of the last boom in 2006 (190,900) Â Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 Just now, guest_northshore said: The first one is specifically about UK SDLT and finds significant leverage impact ignored by most studies, including the one you repeatedly cite while ignoring everything else. You're a homeowner who doesn't like land transaction taxes. Not terribly surprising but fair enough. But that's of zero relevance to whether changes in SDLT affect prices. Particularly whether changes in FTB SDLT screws FTBs. Supply - another tangent for another thread. Please see my correction, I meant last one. Quote Link to comment Share on other sites More sharing options...
Locke Posted November 23, 2017 Share Posted November 23, 2017 Tripe. Fuel duty is 65% of the price you pay at the pump. If the government abolished fuel duty, do you think petrol prices would fall or rise? Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 1 minute ago, Locke said: Tripe. Fuel duty is 65% of the price you pay at the pump. If the government abolished fuel duty, do you think petrol prices would fall or rise? I think the difference between fuel and houses is that houses have a fixed supply and people already pay as much as they can so prices would rise if stamp duty were abolished. Saying that prices were a lot higher in 1998 than a year before despite stamp duty increasing so it is more complicated than that. Stamp duty makes buying more risky as you cannot move later and so helps landlords.  Quote Link to comment Share on other sites More sharing options...
Locke Posted November 23, 2017 Share Posted November 23, 2017 Put it like this:  Imagine if SDLT were 90% You sell your house for £100k and have to hand over £90k to the criminals in charge. Leaving you with £10k Now they abolish SDLT You could now sell your house for £10k and have the same amount in your pocket, however, you are a greedy BTLer and you want that former tax money for yourself and then some. You smugly post on propertythieves that you will sell your house for £460k, because of the 5x leverage on £90k Meanwhile, your neighbour wants to move out of the city. Where he formerly would have gotten £10k in his pock, he is very happy to double his money and sell his house for £20k.  Who manages to sell their house? Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 1 minute ago, Locke said: Put it like this:  Imagine if SDLT were 90% You sell your house for £100k and have to hand over £90k to the criminals in charge. Leaving you with £10k Now they abolish SDLT You could now sell your house for £10k and have the same amount in your pocket, however, you are a greedy BTLer and you want that former tax money for yourself and then some. You smugly post on propertythieves that you will sell your house for £460k, because of the 5x leverage on £90k Meanwhile, your neighbour wants to move out of the city. Where he formerly would have gotten £10k in his pock, he is very happy to double his money and sell his house for £20k.  Who manages to sell their house? SDLT is paid by the buyer, not the seller, the cost of course is on all of us as it damages the economy by more than it takes in and makes life in the UK a lot harder. Quote Link to comment Share on other sites More sharing options...
Locke Posted November 23, 2017 Share Posted November 23, 2017 1 minute ago, iamnumerate said: SDLT is paid by the buyer, not the seller, the cost of course is on all of us as it damages the economy by more than it takes in and makes life in the UK a lot harder. The argument stands. At the end of the day, the buyer had to pay £100k for the house in the first instance and £10k or more in the second. If the max mortgage they can get in the first instance is £100k, how in God's name does reducing the tax magically allow them to borrow more? Quote Link to comment Share on other sites More sharing options...
iamnumerate Posted November 23, 2017 Share Posted November 23, 2017 1 minute ago, Locke said: The argument stands. At the end of the day, the buyer had to pay £100k for the house in the first instance and £10k or more in the second. If the max mortgage they can get in the first instance is £100k, how in God's name does reducing the tax magically allow them to borrow more? In this case the vendor is someone trying strong arm tactics, I guess he would try something else if it were not for SDLT. In short I don't understand either. Quote Link to comment Share on other sites More sharing options...
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