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The abolition of Stamp Duty for first time buyers purchasing properties up to £300,000 is to be welcomed.
According to the UK House Price Index for May 2017, the average property value in the UK was £220,713, so this will definitely generate some movement from the bottom up. The change will assist some downsizers as well.
However, this change will only have a limited effect and does not provide assistance for existing homeowners who are aspiring to move further up the ladder. Those individuals still have to pay Stamp Duty at the current rates.
It is important to remember that the level of Stamp Duty cannot be entirely to blame for the slowdown in the marketplace; the crisis in the availability of new homes is the real issue.
The saving that the first-time buyers make on Stamp Duty, will assist the budgets of those individuals, but won’t necessarily have a major impact on the movement of the housing market. I don’t think it will have the effect of driving down the price of homes and making them more accessible to a larger number of individuals.
The real question is whether the long-term goal of building 300,000 homes a year by the mid 2020's will have an impact. Whether this is enough, remains to be seen. It is a lack of affordable homes, which is the real issue.