Tuesday 28 August 2018 2:05 pm | Updated: Friday 24 May 2019 7:45 pm

Stamp duty keeps pensioners sitting tight as housebuilding giant calls for tax exemption

More than a fifth of pensioners would consider moving house if stamp duty was abolished, according to new research which suggests the property tax is hampering housing market activity.

In a YouGov poll out today, 22 per cent of adults over 65 said they would be more likely to move if there was a stamp duty exemption in place, rising from 10 per cent of respondents the year before.

McCarthy & Stone, the retirement housebuilder that commissioned the survey, has called on Westminster to make stamp duty exempt for pensioners looking to downsize, claiming that if 22 per cent of them moved to a smaller house, it could release roughly £924bn of housing stock.

Britain’s largest builder of retirement homes has been at the front line of the current property market slowdown this year, with the firm revealing in June that profits would be lower than expected, pushing shares down to a record low.

This latest plea for government action comes as a result of a "demographic timebomb", according to McCarthy & Stone boss Clive Fenton.

"Generation Stuck wants to downsize, but moving costs, particularly stamp duty, are holding them back. There’s plenty of focus on building homes for first-time buyers, but last-time buyers have been forgotten… what we need is a Help to Move package, as well as Help to Buy, which would encourage downsizing for the millions of older people who want to move," according to Fenton.

He added: "A one-time stamp duty exemption for older downsizers would encourage up to 2.6m more people to move, freeing up much needed stock for families and first-time buyers. Downsizing is also good for the Treasury with additional gains made from greater property transactions."

Earlier this week estate agent Hamptons International also found that Londoners leaving the capital are increasingly moving up north to pay a cheaper rate of stamp duty.