Under the changes, homebuyers will not pay any tax on main homes up to £500,000 until 31 March 2021.
The average stamp duty saving will be £4,500, with nine out of ten buyers this year now paying no stamp duty at all on purchases.
The change will also include second homes, however, investors will still be subject to the three per cent stamp duty surcharge.
Rishi Sunak said: “We need people feeling confident to buy, move and renovate.”
Previously, only homes below £125,000 and first-time buyers of homes up to £300,000 escaped stamp duty.
Mark Arnold, chief executive of Kensington Mortgages, said: “If the housing market is working properly, that has a massive impact on the rest of the economy – so this potentially is a big boost.
“A stamp duty holiday is a huge market change and this has never happened before.
“First-time buyers, second steppers and older homeowners will all benefit. Even before lockdown, there was a clear stagnation in housing activity on those higher up the property ladder.
“Extending the threshold to £500,000 frees up larger properties for growing families and enables the next generation of homebuyers to step onto or even up the ladder.
“Buyers will make a significant tax saving and this acts as a large incentive to keep all parts of the housing cycle moving in some of the most crucial summer months.”