The Chancellor has steered a prudent course for the economy in his latest Budget, but property advisers GVA Grimley say the fourth consecutive rise in stamp duty is bad news for commercial property, while having a negligible impact on the housing market it is intended to cool down.

Today’s increase in stamp duty should raise around £350 million per annum for the government," says Michael Haddock, research associate of GVA Grimley. "Of this, only around £90 million will be paid by the residential sector with the remainder falling on the commercial sector. This disproportionate impact gives the lie to the claim that stamp duty has been increased to cool down the housing market."

"In fact, the cumulative effect of the various stamp duty rises has been to increase transaction costs for commercial property of £500,000+ by over 100% in just 2.5 years, from 2.75% to 5.75% including today’s rise.

Some sectors of the commercial property market will, however, be breathing a sigh of relief that stamp duty has only increased by 0.5%, after all the hype of recent months, says Paul O’Riordan of GVA Grimley’s investment department. "This increase is more digestible than had been envisaged, but it may still restrict property trading opportunities."

Richard Byatt