The stamp duty holiday did not cause the house price boom, according to the Resolution Foundation.
The think-tank said the strategy has been a waste of taxpayers’ money, as its study shows that the largest increases in prices had occurred in areas that had least benefitted from the tax cuts.
The research added that the housing market would avoid a sharp correction when the temporary incentives were withdrawn completely in the autumn.
The Resolution Foundation said areas of England that had average house prices close to those with the maximum benefit would have been expected to rise most in price if the tax holiday was the main reason for the uplift.
But instead it found no correlation between the areas with the biggest gains and house price increases. Indeed, those with the least to gain saw house prices grow the most.
“In the last year, prices grew 13% in the fifth of local authorities where savings as a result of a transaction tax holiday were negligible or non-existent, compared to 7% in the fifth of local authorities where the highest savings were achieved,” the think-tank said.
