Autumn Statement 2011: No stamp duty holiday extension
The Autumn Statement said: “The government is publishing analysis showing that the Stamp Duty land tax relief for first-time buyers has been ineffective in increasing the number of first-time buyers entering the market.
“This relief will therefore end on March 24 2012 as planned. The government is instead prioritising more effective measures which provide better value for money as set out in its housing strategy.”
Osborne did not announce any new housing policy but repeated the announcement on its mortgage indemnity scheme to help up to 100,000 people buy homes with 5% deposits.
He also said the government would provide a £400m scheme to kick-start stalled construction projects in England and restated that social tenants could expect up to a 50% discount when buying their homes.
Receipts from the right to buy boost would be reinvested in building affordable housing, Osborne added.
Many industry firms and organisations including the Council of Mortgage Lenders and Legal & General will be disappointed with Osborne’s failure to deliver a SDLT holiday extension.
Ben Thompson, managing director of the Legal & General Mortgage Club, said: “Today’s pledge by the government to help first-time buyers by potentially catering for up to 100,000 assisted purchases has to be largely applauded.
“However, the question remains as to the scale of the benefit this will bring to those trying to get a foot on the ladder as it is aimed only at buyers of new build properties.”
Thompson said the government should have considered relaxing “the prohibitive strain of the stamp duty”.
And he added: “Whilst the government is obviously limited in its ability to offer huge tax giveaways as the public coffers stand largely empty such a move may have proved beneficial as it would add grease to the wheels of what has become a vitally important part of the UK economy.”
Charles Haresnape, managing director of Aldermore residential Mortgages, was also disappointed.
He said: “The government backed mortgage indemnity scheme and re-invigoration of the right-to-buy scheme clearly demonstrate that it understands the importance of breathing new life into the housing market.
“It is therefore surprising that nothing was said in today’s statement about maintaining the current stamp duty threshold beyond March 2012. First-time buyers need as much help as possible and the re-introduction of stamp duty on purchases below £250,000 will be a significant disincentive.”