The Chancellor’s decision to abolish Stamp Duty on properties worth up to £150,000 in deprived areas of the country comes as good news to the housing market. The decision, which came into effect on 30 November, affects both residential and business properties and is expected to encourage additional buyers, the renovation of property and the conversion of flats.
However, Ray Boulger, senior technical manager at Charcol, believes the Treasury could have done more.
He said: ‘Despite the Government’s commitment in last year’s pre-Budget statement, that it would announce which disadvantaged areas would qualify for Stamp Duty exemption in the 2001 Budget, no announcement was forthcoming. It obviously spells good news for those who will benefit, but is far from being a new announcement as implied. It is actually a serious backtracking of the commitment given by the Chancellor a year ago and it is disappointing we cannot rely on the Chancellor’s pre-Budget promises.’
Tim Dawson, managing director at Mortgage Express, welcomed the decision.
‘It is pleasing to see the Chancellor has recognised that, at a time of economic uncertainty, steps need to be taken to reduce the cost of buying a home in certain communities,’ he said.
The Government is also expected to either raise the limit, or abolish Stamp Duty on all non-residential properties next year, in a bid to encourage businesses to re-locate to areas included under the scheme.
Boulger added: ‘It is difficult to have confidence in whether this will happen.’
Buy-to-let investors, however, are set to benefit, according to Dawson.
He said: ‘Buy-to-let properties typically tend to be around £150,000, so investors could save up to £1,500 on each property they buy. The economic regeneration in these areas will make them great target areas for would-be landlords.’