An estate agent claims the sales of ‘premium homes’ in London collapsed by nearly two-thirds in 2015 following a change to the stamp duty system.

Douglas & Gordon (D&G) say the Treasury’s re-banding of stamp duty at the end of 2014 saw the sales of houses and flats worth over £2 million in the capital fall by 64%.

There was also also fluctuating movement on property value , with some parts of west London seeing a fall, while others enjoyed a small rise. More of the same is roughly predicted for 2016.

‘Prime’ postcodes, defined by D&G as the area between Notting Hill and Chelsea, saw property sales values decline 1.4% year-on-year overall in 2015.

Read more: You won't believe the staggering amount of stamp duty paid by west London

Sales values in D&G’s ‘Emerging Prime’ areas – stretching from Hammersmith and Shepherd’s Bush in the west, to Clapham and Balham in the south – fared slightly better, with a year-on-year rise in overall sales values of 0.6% for 2015.

D&G say that while Chancellor George Osbourn’s unexpected changes from the old ‘step’ based structure to a tiered one reduced the stamp duty land tax (SDLT) burden for properties sold between £500,001 and £937,000, the introduction of a 12% levy on properties valued above £1.5m has had a significant impact on sales in London’s premium home market.

Executive director Ed Mead says the drop in sales will hit the Treasury and is calling for a reduction in the top rate of SDLT in 2016.

He said: “Looking ahead to 2016, we are expecting the market to be split around the £1.5m mark. Property worth up to £1.5m could grow in value by as much as 5%, but owners of any property worth more than £1.5m can expect a static year.”