- 02
- Sep
Gordon Brown has announced the introduction of a suspension of stamp duty land tax in a package of measures which are designed to help those struggling to get on to the housing ladder.
From tomorrow, homebuyers who purchase a property of a value lower than 175,000 pounds in the next year will be exempt from their stamp duty contributions, which normally total one per cent of the value of the property. However, those opting for properties of a greater worth will still be required to pay a percentage fee which increases with the value of the house.
The move follows a period of instensifying pressure for the government to do more to protect consumers at the bottom end of the housing market. According to the Guardian, previous delays in announcing the exemption have been met with scorn by estate agents, many of whom have attributed a drop in house purchases over the summer to hesitation among consumers as to whether the break would go ahead.
Announcing the new measures, Mr Brown exclaimed: “Homeowners need to know that we will do everything we can to keep the housing market moving forward. Help with stamp duty, help for first-time buyers, help to build more social housing, help to take unsold properties off the housing market and help for people who get into difficulties. These are the things a government should do to help us come through what is a difficult situation and show that our economy is resilient and will come through these problems.”
For those who have been struggling to get their foot on the first rung of the property ladder, taking out a personal loan may provide the capital necessary to put down a sizeable deposit in an effort to secure a deal in difficult lending conditions. Doing so may be of particular interest to those planning on buying a home which is of a greater value than the exemption threshold, as a low-rate of this type could be used to cover stamp duty commitments.
While the announcement will surely be welcomed by many consumers, the Times has noted that Brown’s initiative has drawn criticism from a number of camps on the grounds that the tax holiday does not provide enough assistance for struggling consumers.
Sue Anderson, a spokesperson for the Council of Mortgage Lenders, said that the starting threshold for payment of stamp duty was still too low. According to figures published by the group, 215,000 buyers could potentially benefit from the exemption, although it expects that the real figure will be far lower because many people have been dissuaded from entering the housing market while it is in a slump.
For those who are looking to enter the housing market, a low-rate loan may prove an effective way to raise funds for a deposit, while a loan used for debt consolidation may also be of help to those struggling with mortgage repayments. According to recent figures from the Council of Mortgage Lenders, an increasing number of repossessions have been ordered in recent months as people feel the pinch of inflated living costs.
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