Ministers, peers and think-tanks are now urging Philip Hammond, the Chancellor, to cut stamp duty in the Autumn Budget, amid fears that the tax is slowing down the housing market. The Daily Telegraph has campaigned for the tax to be reviewed.

One Cabinet minister, who wishes to remain anonymous, said that the situation was now so acute it was had “a big implication in terms of economic growth”.

A lack of housing for younger Britons is one of the most serious political problems facing the Conservatives and many senior Tory figures believe that Theresa May must find a way of addressing the issue if she is to match Labour's popularity among voters under 40.

It was previously assumed that this could only be done by building more homes, but it has now emerged that George Osborne's decision to sharply increase stamp duty has also had a major effect on the supply of housing.