In the political jockeying to be the next Prime Minister, one eye-catching proposal to emerge is a cut to Stamp Duty for homes below £500,000 as part of an emergency Budget.

It has certainly grabbed the media’s attention and reignited a debate about the need to reform Stamp Duty.

Many agents I speak with see current Stamp Duty levels as an extra burden on buyers and a barrier to more sales, especially in London and the south-east where house prices are highest.

Stamp Duty, and recent reforms to the tax, have certainly filled the Government’s coffers at a time of austerity. Stamp Duty Land Tax (SDLT) is paid on over 1m residential sales a year and raises over £8bn annually, double what it raised seven years ago.

The tax has now been devolved to the Welsh Government in 2018, and the Scottish Government in 2015, so the rates paid for homes of the same price vary across the UK.

SDLT now applies only in England and Northern Ireland and has been replaced by the Land and Buildings Transaction Tax in Scotland and the Land Transaction Tax in Wales.

As well as agency intuition, academic research shows that higher transaction costs reduce sales.

While housing turnover has grown from the lows after the credit crunch, sales volumes have been flat for the last few years and down slightly over 2018.

So will cutting Stamp Duty for homes under £500,000 make a big difference to the market in England?

Our research team has crunched the numbers and estimate that 290,000 sales a year would be removed from paying SDLT in England and Northern Ireland. This would save buyers £2bn in tax – an average saving of £6,900 per purchase.

This would take an extra 34% of sales out of SDLT to add to a similar amount who already pay no SDLT due to lower property prices or reliefs, such as that for first-time buyers where 170,000 already get full or partial relief from SDLT.

There would still be a £7bn SDLT bill but it would be picked up by those with more than one home paying the 3% higher rate (£4bn) or with homes worth over £500,000 who pay £3bn.

Such a change would be of particular benefit to regional housing markets outside London and the south-east where more sales sit below £500,000.

This would boost sales in some areas but home buyers purchasing homes over £500,000 would still face the same large Stamp Duty bills under the existing tax arrangements.

Stamp Duty is just one factor that makes for a less efficient housing market in large parts of the country. While housing has risen up the political agenda in recent years, the net result has been a slew of successive tax, policy and regulatory changes aimed at addressing different aspects of the market.

Successive governments have talked about radical housing market reform, but I am yet to see an approach which truly looks to create a fairer, buoyant market in a holistic way.

It is worth making clear that Stamp Duty reform is not a panacea in my view. It is a single factor currently impeding housing market fluidity, alongside factors like the general shortage of homes due to long-term under-supply and the current political situation leading to buyers and sellers taking a ‘wait and see’ approach.

A lack of affordability remains the greatest challenge facing the market across southern England so any changes that reduce the cost for home buyers would be welcome, but our analysis shows there will still be a sizeable bill to pay in the areas where housing is most unaffordable.

It is clear we need our policy makers to think about the type of housing market they need to support economic growth. This means thinking beyond home ownership and including rental and other tenures.

Improving housing choices for consumers and reducing costs needs to be part of this agenda.

Whoever is the next Prime Minister or forms the next Government, I would like to see them call for a full review of Stamp Duty but also adopt a focus on UK housing policy making with a view to creating a sustainable market that works for the better for all households across all tenures.

* Charlie Bryant heads up Zoopla