Prime Minister Liz Truss will cut the rates of stamp duty for UK home purchases as the government attempts to stimulate growth, The Times of London reported. Homebuilders climbed.
The premier and her Chancellor of the Exchequer Kwasi Kwarteng will announce the measure on Friday as part of a mini-budget to boost the country’s economy, the newspaper said, citing two people with knowledge of the matter. The Treasury declined to comment.
Any reduction in the levy will probably bolster home prices, which soared during the pandemic when the tax was suspended for many buyers in order to stimulate demand. Rising mortgage rates and the cost-of-living crisis have since led HSBC Holdings Plc to warn earlier this month that the UK is on the “cusp of a housing downturn.”

Homebuilders Persimmon Plc and Berkeley Group Holding rose more than 6% in London trading on Wednesday before paring gains. Broker Foxtons Group Plc gained as much as 2.1%.

“A stamp duty cut may revive the fortunes of UK homebuilders, who started seeing normalization of activity from frenetic levels of the last two years,” said Iwona Hovenko, a real estate analyst at Bloomberg Intelligence. 
Homebuilders had benefited during the pandemic as frustrated buyers, confronted by a lack of homes for sale in the secondary market chose to buy new builds instead, boosting developers’ order books, she said.