The government have recently announced the quarterly statistics on stamp duty; claiming that 121,500 households have benefitted from the stamp duty cut. This equates to a saving of over £284 million.
Currently, first-time buyers purchasing houses costing less than £300,000 are immune from additional stamp duty costs; with any housing priced under £500,000 also receiving a stamp duty cut. The statistics suggest that first-time buyers have significantly benefitted from the cuts.
Financial Secretary to the Treasury, Mel Stride, said: “Once again, we can see that our cut to stamp duty for first-time buyers is helping to make the dream of home ownership a reality for a new generation – exactly as we intended.”
The report further indicates that first-time buyers have continued to grow whereas other property buying groups have started to decline during this quarter. The report also found that transactions involving additional dwellings decreased by 2% to 54,500 during this quarter sales.
Michael McCarthy, Developer at Equitas Properties said: “This policy allowed these new home buyers reduced acquisition costs while increasing options, choice and purchasing power.”
Although the relief for first-time buyers is desperately needed for them to get a foothold in property, other home buyers continue to struggle with the costs of stamp duty and may discourage them from moving house.
Shaun Church, director at mortgage broker Private Finance, added “Yet stamp duty continues to clog up other areas of the market. Transactions have risen quarterly but are lower than they were this time last year. Thanks to a tunnel vision approach to stamp duty relief where only first-time buyers benefit, all other homebuyers – from second-steppers to potential downsizers – are being dissuaded from moving due to punitive tax charges. This creates lack of movement further up the chain in an already sluggish market, and ultimately fewer options for buyers looking to move up and down.”
Overall, the government will view this as a win for their policy concerning first-time buyers and highlighted the fact that over the next five years the stamp duty policy will help over 1 million first-time buyers getting onto the property ladder.
Has the concerted government attempt to help first-time buyers boosted the property market? Or, have you found that other home buyers are reluctant to move up and down the ladder because of these additional costs?