Game Over for renting if stamp duty rises too much, agent warns

A respected agent is warning that a proposal to increase stamp duty on additional homes could kill off the rental market in his area.

Harrison Trower, director of Broadlands agency on Jersey, says the original three per cent stamp duty surcharge proposed in the island’s Government Plan was “already hard enough to stomach” and that a proposed 10 per cent hike - as some have called for - will cause much more damage. 

Jersey politicians Raluca Kovacs recently lodged an amendment to the Government Plan to increase stamp duty on residential properties not permanently lived in by the owner by 10 per cent, including investment properties, buy to lets and holiday homes.

There is another amendment lodges by Jersey politician Max Andrews calling for the three per cent surcharge to be increased to four per cent. 

Trower is quoted in the island media as saying: “The problem you have is that a lot of second homes are buy to lets. A lot of people can’t afford to buy and their first introduction to the housing market is by renting a place. 

“If you increase stamp duty by 10 per cent on second homes, then no one is going to buy a house, which means that you are going to kill off the rental market and you will hurt the little person more.

“Increasing stamp duty seems to be the government’s fall-back for everything. In a booming market I get it, but that is not the case. Three per cent is hard enough to stomach, but I understand it. However, it is game over for a few years if it increases by 10 per cent.

“The catch in the current market is that with interest rates going up, first-time buyers are drying up anyway. Buying a place is not cheap and the current situation has already removed a massive pool of people who can afford to buy.”