Stamp duty exemption 'set to benefit a million buyers'
Just about every landlord and agent will be aware of the demographic and economic factors that have been driving the rise in the number of young renters.
The difficulties faced by ‘generation rent’ in getting on the property ladder have prompted a range of government policy responses. These have included Help to Buy, the Lifetime ISA and, at the last Budget, a stamp duty break for first-time buyers, with a full exemption for properties costing up to £300,000, or an exemption on the first £300,000 where the home costs more, up to £500,000.
New figures have indicated that 69,000 first-time buyers have benefited from the stamp duty tax break since it was announced in last November’s Budget. Moreover, it is estimated that over a million will benefit from the policy over the next five years.
In addition, other figures that have just been published show 387,000 people have now benefited from Help to Buy and 1.1 million have opened Lifetime Isas, which attract an extra £3,000 from the government and can help with the raising of a deposit.
Responding to the figures, which cover up to the end of March, financial secretary to the Treasury Mel Stride said: “I’m proud that the cut to stamp duty for first-time buyers is helping to realise the dream of home ownership for a new generation, alongside building more homes in the right areas, and generous schemes such as the Lifetime ISA and Help to Buy.”
However, the upbeat response of Mr Stride may have some justification. Aldermore Bank has warned that the benefits of these steps may be swamped by rising prices.
Commercial director at the mortgage provider Charles McDowell said the stamp duty figures were “encouraging” and pointed to the firm’s own research before the measure was introduced, indicating that 30 per cent of first-time buyers would speed up their home-buying plans if a stamp duty tax break was introduced.
However, he added, the “underlying issue” of a lack of affordable homes is still to be resolved.
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