A stamp duty freeze was hinted at last month – leading to claims that the housing market had been slowed further by the rumor. It has just been announce by the Treasury that the current £125,000 threshold will be raised to £175,000 for 12 months in an attempt to boost the market.
Around half of the 90,000 homes bought each month cost £175,000, or less. A house buyer purchasing a property at the average UK price of £165,000 will now save £1,650 (1% stamp duty) under the scheme, which could cost the Treasury as much as £600 million over the next year.
The government has not indicated how it will cover the massive tax revenue shortfall resulting from the stamp duty freeze. Chancellor Alistair Darling said that he would give more details in his Autumn Pre-Budget Report. He also stated that the Government was considering ways of increasing access to mortgage finance.
Other housing moves announced by the government, exclusively for properties in England, include:
- “Free” five year loans of up to 30% of a property’s value for first time buyers
- Extension of powers for councils and housing associations to pay off the debts of homeowners who can no longer afford mortgage repayments – and charge them rent instead.
- Shortening the period before Income Support for Mortgage Interest is paid from 39 weeks to 13 weeks.
- Bringing forward spending from future years to encourage more social housing to be built
1 comment so far ↓
When are they going to implement this system? People need help now not more smoke and mirrors. I cannot find a single person who knows when the money will come and how it will be distributed. A farce!
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