WHAT THE BUDGET MEANS FOR FIRST-TIME BUYERS AND THE PROPERTY MARKET
IN THE BUDGET THE CHANCELLOR ANNOUNCED THAT STAMP DUTY WOULD BE WAIVED FOR FIRST-TIME BUYERS ON PURCHASES OF UP TO £300,000 – AND ON THE FIRST £300,000 OF DEALS WORTH UP TO £500,000, WHICH IS GOOD NEWS FOR THOSE BUYING IN LONDON. THIS WILL SAVE FIRST-TIME BUYERS UP TO £5,000.
The removal of stamp duty for first-time buyers should mean a boost for the housing market as a whole. Barclays responded within hours of the announcement by reintroducing 95 per cent loan-to-value products aimed specifically at first-time buyers, and we expect other lenders to follow suit.
Since extensive reform of stamp duty in 2014 – when the slab structure was removed and rates increased for those buying a home for more than £937,000 – the number of property transactions has fallen, although stamp duty revenues have not decreased. Stamp duty is a significant consideration for those buying in the £2m-plus bracket, with an increasing number of people now choosing to improve rather than move.
We would prefer to see more in the way of transactions, which are good for the whole economy, and any move to help first-time buyers as a first step towards this, is welcome.