Property specialists have raised major concerns about the practicalities of Kemi Badenoch’s announcement to abolish stamp duty entirely.
Industry figures warn that crucial implementation details remain absent from the Conservative leader’s pledge.
During her conference speech on Wednesday, Ms Badenoch said: “The next Conservative Government will abolish stamp duty on your home.”
She described it as “a bad tax” that hampers social mobility.
Emily Maitlis, co-host of the News Agents podcast, said: “It was a mood changer. It was something big brush enough for people to get to their feet again and say, ‘The Conservatives are back’.”
However, industry experts quickly questioned how the proposal would work in practice.
Michelle Lawson, director at Fareham-based Lawson Financial, said: “As with everything the devil is in the detail. It raises more questions and problems than it solves.”
Stephen Perkins, managing director at Norwich-based Yellow Brick Mortgages, echoed these concerns.
Mr Perkins said: “Of course scrapping stamp duty will be hugely welcome and positively received, but the detail is what will be brought in to replace it?”
Kemi Badenoch unveils Conservative’s plans to scrap stamp duty
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Property analysts have cautioned that abolishing stamp duty could substantially increase house prices.
They warn that any rises would likely benefit wealthier buyers rather than those struggling to get on the housing ladder.
Lucian Cook, head of residential research at Savills, said: “If, and this is a big if, it is a simple tax giveaway, the likelihood is that the current stamp duty bill simply passes through into house prices.”
His analysis suggests average price increases between 1.4 per cent and 2.1 per cent.
That translates to between £5,100 and £7,500 per property.
Mr Cook also highlighted the uneven distribution of benefits.
He said: “Given the way stamp duty works, this would be unevenly distributed across the country’s housing stock with a much greater impact on high value homes, meaning London and the South East would benefit most.”
The financial implications have prompted concern among mortgage industry leaders about the Treasury’s ability to absorb such large revenue losses.
Stuart Cheetham, chief executive of MPowered Mortgages, said: “In 2023 to 2024, people buying homes paid £8.6billion of stamp duty straight into Government coffers — and the figure is likely to have been even higher in the latest tax year.”
Total stamp duty land tax revenues reached an estimated £13.9billion in the previous financial year.
That includes additional homes and commercial properties.
Ms Badenoch said the Conservatives had “cautiously” estimated the cost at £9billion.
The Institute for Fiscal Studies calculated that eliminating stamp duty on primary residences alone would cost about £4.5billion.
The feasibility of the proposal has drawn sharp criticism from some mortgage professionals.
They argue it fails to address underlying issues in the housing market.
Rohit Kohli, director at Romsey-based The Mortgage Stop, said: “When you’re in opposition and unlikely to win power, you can promise whatever you like because you know you won’t have to deliver it.”
He added: “Getting rid of the tax won’t suddenly make buying easier. It’ll just push prices up further without tackling supply.”
Mr Perkins also raised concerns about revenue replacement.
Ms Badenoch said the Conservatives had “cautiously” estimated the cost at £9billion of abolishing stamp duty
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GETTYHe said: “The Government cannot afford to lose that revenue, so surely it will just be paid through some other part of the transaction.”
Mr Cheetham noted that first-time buyers currently paying no stamp duty on properties under £300,000 would see no benefit from the changes.
Despite the scepticism, some in the property sector see potential upsides for market activity.
Justin Moy, managing director at EHF Mortgages, said: “Stamp duty is singlehandedly slowing the property market to a crawl, so this significant pledge by Conservatives will be welcomed not only by those looking to buy, but the industry as a whole.”
Mr Moy suggested the policy could particularly help those facing stamp duty bills of £30,000 to £40,000 on family homes in expensive areas.
A spokesperson for the HomeOwners Alliance said: “We strongly support the Conservative Party Leader’s call to abolish stamp duty. Our research shows over 800,000 homeowners have shelved moving plans in the past two years, and stamp duty is a major barrier.”