Young people trying to get on the property ladder were handed a pre-election boost worth up to £2,500 in yesterdays Budget
Young people trying to get on the property ladder were handed a pre-election boost worth up to £2,500 after the chancellor scrapped stamp duty on homes costing £250,000 or less for first-time buyers.
The move will be funded by an increase to 5% in the duty on homes costing £1m or more, which will see buyers of these properties having to hand over a minimum of £50,000 in tax. The move was quickly dubbed by some as a ‘Robin Hood‘ tax on the rich.
The new £250,000 threshold, which took effect at midnight last night and will last for two years, means nine out of 10 people buying their first home will not be liable for the tax.
Alistair Darling said: ‘The housing market has now stabilised and has begun a slow recovery. But many first-time buyers, particularly those without large deposits, still find it hard to get a mortgage. I want to help them, but in a way that is properly funded.’
The announcement was generally welcomed by housing market commentators, who said it would put the dream of home ownership back within reach of thousands. The change will lift the average UK home out of the stamp duty net. According to the Nationwide and Halifax, the typical home costs a little over £160,000.
The National Association of Estate Agents said: ‘This announcement has added a new rung to the property ladder, one within reach of thousands of young families.’