Chancellor announces changes to stamp duty

Posted: 04 Sep 2008 12:33:36 GMT

The government has announced that stamp duty land tax will no longer apply to purchases of home valued at £175,000 and less.

Chancellor of the Exchequer Alistair Darling explained that exemption, effective from September 3rd, 2008, would only be provided to transactions made up entirely of residential property.

The new stamp duty is one of a number of packages that the government is introducing in an attempt to ensure "a fairer housing market for all".

It also announced a HomeBuy Direct scheme to encourage first-time buyers to enter the housing market by providing them with an interest-free equity loan and a £400 million injection to the delivery of affordable housing.

Responding to the new programme, property consultant Knight Frank questioned how many people would actually be helped. It was also dubious about their ability to redress the balance in the housing market.

"We would urge policy makers to resist the urge to tinker with the market. Confidence will return when prices are perceived to have reached a more reasonable level, and it is unlikely that any government package can encourage people to enter a faltering market," said Joe Neale, head of development at the company.

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