Sales of £2m-plus homes have “fallen off a cliff” because of higher stamp duty, estate agents have reported.

Owners of properties worth a little less than £2m have put off improvements in a bid to circumvent the 7% rate on top-end homes that the government introduced a year ago. Savills reported a 25% fall in transactions in the £2m-£5m bracket while other agents put the overall figure nearer to 45%. Knight Frank estimates sales of £2m-plus homes will be down about 15% in the year to the end of March but sales of homes worth £1m-£2m are likely to have increased by about 5%.