Stamp duty exemption ends on 24th March 2012

The clock is ticking…
The first time homebuyers stamp duty exemption ends on 24th March 2012

In an attempt to breathe some life in to the housing market on the 25th of March 2010 the chancellor George Osbourne announced a scheme whereby first time buyers did not have to pay stamp duty when purchasing a property. If the purchase price fell between £125,000.00 and £250,000.00 the purchaser, if they met the qualifying criteria, would be exempt from the levy. Wyn Williams, partner Harding Evans encourages first time homebuyers to seriously consider taking the plunge.

What effect this stamp duty exemption had on the housing market during the course of the last twelve months is shortly to be revealed, however the Chancellor George Osborne's Autumn Statement gave the view that it has failed to get more people on the property ladder. 

However, while stamp duty exemption may not have stimulated additional demand, the absence of the exemption may well have a significant effect on the first time buyer’s ability to purchase a property. With lenders requiring a significant deposit to be in place, first time buyers’ resources may be stretched to the limit; and without the benefit of tax relief, the property may prove just out of reach.   The beginning of 2012 could therefore see an increase of first time buyers attempting to grab the property ladder with the benefit of a minimum savings of £1,260.00 before the relief is scrapped on the 24th March 2012. 

With recent surveys showing that the values of properties are falling, the news isn’t great for home owners looking to sell, but it creates a twofold incentive for first-time buyers. With a stamp levy exemption and falling home prices – this should be the sign first time homebuyers have been waiting for. 

Recent reports show the number of first time buyers getting on to the housing ladder has reached a three-year low. These buyers represent the life force of the property market, so governments will need to do more past March to help this fragile market. 
But with the exemption ending in March it would be in the best interest of potential new home buyers to take the plunge and take the benefits while it on offer.  With stamp duty representing one of the biggest add-on costs when buying a property the savings of a minimum of £1,260.00, can make that mortgage obtainable or at the very least buy new lounge furniture!