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| THURSDAY 17TH MARCH 2005 |
 FIRST-TIMER
STAMP DUTY HELP NOT ENOUGH
Chancellor Gordon Brown doubled the stamp duty threshold to £120,000
in his budget yesterday but critics say the limit is still
too low to benefit many first time buyers.
The Council of Mortgage Lenders said the new threshold was
still to low and others such as the Halifax, Nationwide and
the National Association of Estate Agents said the help was
not enough to help first time buyers across the country.
"The stamp duty concession is naturally welcome, and
will help some first-time buyers," said the CML, "-
although its effect will be muted in southern England where
affordability is worst. The starting threshold would be over £150,000
if it had been index-linked since Labour came into office."
Miles Shipside, commercial director of Rightmove.co.uk said, "Some
first time buyers will clearly welcome this news, but only
a very limited number in some regions, due to the way prices
have risen."
Only 15% of homes below threshold
Analysis of 440,000 properties on the Rightmove.co.uk site
shows that there are only 15% priced at below even the new
threshold of £120,000. Just 2% of properties in London
and 7% of properties in the South East are on the market
at less than £120,000, with many of those shared ownership
or retirement properties. In the South West, it is 10% and
in East Anglia it rises to 16%.
Other more northern regions of the country are the main
beneficiaries, with a greater number of properties priced
at below £120,000 - 23% in the West Midlands and in
Wales, up to 32% in the North.
"Of course," says Mr Shipside, "once a property's
price goes over the threshold, you pay stamp duty on the
full amount. This change is likely to be seen as regionally
divisive as it will help some people in regions like the
North and Yorkshire & Humberside - and virtually no-one
in London and the South East."
Mr Shipside thinks it would have been much fairer to waive
or reduce stamp duty for all 'genuine' first time buyers,
so that people in all parts of the country can benefit and
get a little help from the government to get on the housing
ladder.
Peter Bolton, NAEA chief executive welcomed the move saying, "The
chancellor should be praised for finally responding to the
overwhelming pressure from the housing industry to update
the archaic stamp duty system."
However, he agrees that the move did not go far enough. "With
average house prices across the UK now 150 percent higher
than when the base level was last amended in 1993, a more
significant increase in the minimum threshold to 150,000
grounds was needed to make any real difference to the majority
of homebuyers," he said.
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