The government is facing calls to extend first-time buyer stamp duty relief and increase access to the housing market as figures showed £426m was relieved since the exemption was introduced.
Statistics released by HM Revenue & Customs today (21 November) showed that in the most recent quarter 58,800 transactions claimed first-time buyers’ relief, bringing the total number of claims since the relief’s introduction to 180,500 – a monetary value of £426m.
The relief was introduced in November 2017 to purchases of residential property by first-time buyers for £500,000 or less and then extended in last month’s Budget to first-time buyers buying through shared ownership schemes.
The HMRC figures showed stamp duty transactions increased by 11 percentage points to 307,100 between the second quarter and third quarter of this year.
The latest transaction figures are 8 percentage points lower than those recorded in the third quarter of 2017 but this data was not directly comparable due to the devolution of stamp duty to Wales in April 2018.
But there were concerns stamp duty remained a “financial barrier” to those higher up the housing ladder.
Kevin Roberts, director at Legal & General Mortgage Club, said this was particularly the case for growing families looking to upsize or last-time buyers looking to downsize.
He said: “The changes in the Chancellor’s recent Budget were certainly welcome, however, if we are to create a housing market that is accessible to all we must do more for older homeowners by extending the stamp duty exemption.
“After all, encouraging movement higher up the ladder allows properties further down the ladder to be freed up, which could help lift the stagnated transaction market we have been seeing.”
Shaun Church, director at Private Finance, said the stamp duty exemption had arguably been one of the most successful initiatives at getting more buyers onto the housing ladder but he said it should not end there.
He said: “We urge the government to turn its attention to last-time buyers as too many would-be downsizers remain in their family homes unwilling to move due to the hefty tax bill they would incur.
“Encouraging these homeowners to move to smaller and more suitable homes would unglue the housing market, and unlock a supply of properties for prospective buyers further down the chain, helping to rebalance the supply of UK property in relation to demand.”
Source: FT Adviser