Prices dropping after stamp duty holiday ends

patchyX2

Do you think that house prices will drop after the stamp duty holiday ends? If so, to what extent?

Houses around my area are being snapped up for silly money currently, so much so that I'm thinking of putting mine on the market. I wasn't planning to move for a few years yet, but to my mind, when the stamp duty holiday ends, house prices are likely to dip by x% as buyers are going to have less money to go towards the house as they have to pay x% on stamp duty.

If I were to sell my home for silly money, move into rented accomodation, wait a few months for house prices to settle to a more 'normal' level, then look at buying somewhere, I could get more house for my money than I can currently. Of course there's the big risk that house prices continue to skyrocket and then I get left behind.

I know that no one knows the answer to this, but I'm interested to see people's opinions. I feel like house prices are crazily high at the moment and a fall must be immenent...but I've been saying the same thing for a few years now, so I clearly know nothing!

Sunsaru

I think you've missed the boat if you want to sell now, things seem to be cooling down a bit. If you go looking for a payday I doubt you'll get it.
As for prices, I think they would stagnate more than drop but that is just my opinion due to my crystal ball being on charge in the other room.

Thrugelmir

The rent you'll be paying might soon negate any benefit. Require a broader correction than an adjustment for stamp duty alone. Many have made money from stock markets in recent years. As yet no sign of a correction there. Perhaps once all the fiscal support measures finally end and the fog lifts. Then the damage caused by Covid and how the bill is to be paid might change the dynamics. 

moneysavinghero

If you put your house on the market now you are unlikely to complete a sale before the end the Stamp Duty holiday.

TXC

however if your house is likely to be under 250k - go for your life

Scotbot

I am not sure sold prices will drop as there is so little supply round me. I do expect over ambitious asking prices to cease, regularly seeing a few properties listed which are over optimistic then dropping  in price a few weeks later.

Redwino222

I don’t really understand why the stamp duty is having the effect on prices - it it indeed is.  The average savings aren’t huge and aren’t equal to the increases.  

Getting_greyer

Redwino222 said:

I don’t really understand why the stamp duty is having the effect on prices - it it indeed is.  The average savings aren’t huge and aren’t equal to the increases.  

Look at what having £10 off at McDonald's did to the economy last year...

Hannimal

Honestly I do not think prices will drop. They will at worst/best plateau 

Getting_greyer

There's always a risk with something like this. But the rewards are potentially huge. You could sell up and put it all on black....

I think it depends on what type of place you have.  I think homes that you would call traditional starter homes in towns with no prospects will probably drop until investors swoop in.  Your bigger places will probably be not much change.  

Low paid ftb in affluent areas will suffer, older people downsizing will gain and the rest of us will plod along.

All in, there was very few people expecting the crash in 08/09, and few expecting the surge of 2020, so depends on your appetite for risk.  I won't be putting my money where my mouth is,  though I did predict Luton Town would avoid relegation last year when were adrift at the bottom of the table so maybe I am clairvoyant? 

Getting_greyer

Getting_greyer said:

There's always a risk with something like this. But the rewards are potentially huge. You could sell up and put it all on black....

I think it depends on what type of place you have.  I think homes that you would call traditional starter homes in towns with no prospects will probably drop until investors swoop in.  Your bigger places will probably be not much change.  

Low paid ftb in affluent areas will suffer, older people downsizing will gain and the rest of us will plod along.

All in, there was very few people expecting the crash in 08/09, and few expecting the surge of 2020, so depends on your appetite for risk.  I won't be putting my money where my mouth is,  though I did predict Luton Town would avoid relegation last year when were adrift at the bottom of the table so maybe I am clairvoyant? 

Or just delusional.