Stamp duty is to be abolished immediately for first-time buyers on all properties worth up to £300,000 removing a major hurdle to getting onto the housing ladder.
The reform, one of a raft of Budget changes designed to boost home ownership, will knock up to £5,000 off the cost of purchases.
It was announced alongside a £44bn plan to boost home building to 300,000 a year by the mid-2020s and a threat to compulsorily purchase parcels of land sat on by developers.
But it was the stamp duty change – which applies in England, Wales and Northern Ireland – that for many will have been the most eye-catching measure in Philip Hammond’s first autumn Budget.
Until today, first-time buyers paid stamp duty on purchases above £125,000. The Treasury says that raising the threshold to £300,000 will mean 80% of them pay no stamp duty.
They will also pay less on purchases between £300,000 and £500,000.
The Government said it was introducing the changes because those trying to get onto the housing ladder were more cash constrained than other buyers, as they also struggled to cobble together deposit and conveyancing fees.
For the average first-time purchase of £208,000, the current £1,660 stamp duty is being axed.
At the highest end, a £300,000 purchase which would have attracted a £5,000 stamp duty charge will now face no such cost.
A £410,000 average first-time buyer property in London which would have resulted in a £10,500 stamp duty charge for a first-time buyer will now see that fall to £5,500.
For properties costing £500,000, the charge will drop from £15,000 to £10,000.
Stamp duty is unchanged on properties above £500,000.
Source: Sky News