Andy Burnham has been urged to cut stamp duty for over-65s to boost the nation’s sluggish property market.
Pensioners should receive the same stamp duty relief as first-time buyers to encourage them to sell larger family homes and downsize, according to a new report from think tank Radix Big Tent’s housing commission.
First time buyers in England and Northern Ireland pay no stamp duty when buying properties worth up to £300,000. Stamp duty is then levied at a 5pc rate between £300,000 and £500,000, at which point the relief ends.
For all other buyers, stamp duty is paid on property sales upwards of £125,000, with the rate levied on a sliding scale of 2pc to 12pc based on the home’s value.
The housing commission said the cost of stamp duty was stopping older people from down-sizing. It said expanding the stamp duty relief to pensioners could bring up to 870,000 family homes back onto the nation’s property market.
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The business-led commission was launched in 2024 to develop policies aimed at tackling the nation’s housing crisis and a number of its previous recommendations have been adopted by the Government.
Alex Notay, the chairman of the housing commission, said the UK faced “a stark and growing generational housing divide”.
The commission found that over-60s now hold a record £2.89tn in housing wealth, more than half of the UK’s total property wealth.
Ms Notay said encouraging down-sizing would help to rebalance the country’s property wealth and help growing families move into bigger homes.
The English Housing Survey found that around 70pc of over-65s live in properties with more bedrooms than they need.
Mr Burnham then rowed back on the reports and ruled out making any changes to stamp duty in the upcoming Budget.
Ben Rich, the chief executive of Radix Big Tent, said: “We have to be more radical if we are really going to get the housing market moving again, which means incentivising older people to find homes better suited to their needs.”
Polling carried out by the Family Building Society, a member of the housing commission, found that 50pc of over-65s see paying stamp duty on a property purchase as a reason not to move home.
Economists and policymakers from across the political spectrum agree that stamp duty weighs on the property market by preventing Britons from moving.
A Treasury spokesman said: “As has always been the case, decisions on tax are a matter for the Chancellor to set out at fiscal events, rather than routinely commenting on rumour, speculation or proposals.”
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