Public backs stamp duty abolition for first-time buyers

The Conservative party’s proposal to raise the stamp duty threshold for first-time buyers to £250,000 has been backed by a public survey commissioned by the New Homes Marketing Board (NHMB).

The YouGov poll revealed that 85% of respondents thought stamp duty was a barrier to purchasing for first-time buyers. It also showed that 43% of the 2,000 respondents believed housebuilders should foot the bill for stamp duty to help first-time buyers on to the property ladder.

A further 59% said first-time buyers should have priority to buy over investors.

David Pretty, former chief executive of Barratt Homes and chairman of NHMB, welcomed the move but said raising the threshold had to be part of a set of measures aimed at first-time buyers.

He said: “The elimination of stamp duty on its own will not be effective. It needs to be part of an overall package of special measures in areas of acute housing need, including land release and fast-track planning.”

The threshold currently stands at £125,000 and is therefore applicable to most first-time buyers, especially in the South.

Figures from the government’s revenue and customs department revealed this week that stamp duty revenue from residential sales rose 40% (£1.6bn) in 2006/07. Over the past five years, residential stamp duty revenue has risen 140% from £2.7bn in 2001/02 to £6.4bn in 2006/07.

Pretty also called on his former colleagues in the industry to devote at least 20% of future homes to first time buyers and to give them genuine priority over investor purchasers as well as help with deposits and moving costs.

Research shows that the cost of buying the average home in England has increased four times faster than the average wage since September 1997.