The Conservative Party has pledged to get rid of the stamp duty land tax if they won the next general election.
This would apply to primary residences, meaning investors would still have to pay the tax.
Stamp duty is commonly blamed on disincentivizing transactions, including preventing older people in larger homes from downsizing.
Kemi Badenoch, leader of the Conservative Party, said: “Stamp duty is a bad tax.
“We must free up our housing market, because a society where no one can afford to buy or move is a society where social mobility is dead.”
Badenoch was speaking at the end of the Conservative Party conference, where she set out a vision of being in a country where “profit is not a dirty word” and where government “does less but does it better”.
She added: “We believe that owning your own home gives you a real stake in society, roots in your community. But our housing market is not working as it should,” she said.
“There is a big barrier that keeps getting in the way.”
Badenoch’s speech comes after the Labour Party administration were also reportedly thinking of axing stamp duty, replacing it with an annual property tax on homes worth more than £500,000.
The Conservatives made a “cautious” estimate that scrapping stamp duty would cost around £9bn by the end of the decade.
Based on the effects of the previous ‘stamp duty holiday’ periods – where the money buyers had to pay was lower for a set period – it’s likely that getting rid of the tax would result in an immediate uplift in activity, likely pushing up house prices in the process.
The tax has long been an unpopular one in the property industry.
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “We welcome the Conservatives’ announcement that stamp duty is to be abolished.
“Stamp duty may have proven to be an excellent revenue raiser but is also a deterrent to mobility, upsizing/downsizing and economic growth. Stamp duty reduces liquidity and distorts pricing in the existing homes, as well as new-build, market.
“Genuine first-time buyers shouldn’t pay – they are the engine room of the housing market helping to unlock transactions further up chains.
“But be careful what you wish for. The revenue generated by this hugely unpopular tax will have to be replaced – but there must be a better way.
“We certainly need an urgent debate to determine what alternative is going to have least impact on activity.”
