Government 'overestimated effect of stamp duty holiday'

Posted: 04 May 2010 10:41:28 GMT

The government has overestimated the effect that the stamp duty holiday has had on the property market, one expert has advised.

Paul Holmes, chief executive of Firstrung, says that he believes the government should now stay "well away" from the housing sector.

"No incentives, no initiatives, they should just let market behaviour take care of the market place but they won't because they are petrified of house prices falling any further," he states.

Mr Holmes' comments come in response to new research from the British Bankers' Association shows that gross mortgage lending has declined.

Some £8.7 billion was lent to homeowners during the month of March, while the average for the past six months has been £9.2 billion.

Similarly, Hometrack recently revealed that house prices increased by 0.2 per cent last month, a figure which is down slightly on the previous two month's growth of 0.3 per cent.

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