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Stamp duty changes would make mortgages easier

Date: 25 Jan 05

Mortgages would be more accessible if stamp duty was reformed, a leading industry body has urged.

Yesterday Tony Blair and John Prescott unveiled plans to build new properties and help people on lower incomes own a share of their homes.

While the proposals have been broadly welcomed, the National Association of Estate Agents wants ministers to go further.

The group warns that stamp duty remains the single biggest obstacle to people looking to buy their first homes.

Barring some exceptions, stamp duty is paid on properties worth more than £60,000 at a rate of one per cent.

It trebles on houses costing more than £250,000 and purchasers pay four per cent on properties worth more than £500,000.

Without exception all properties worth more than £150,000 incur stamp duty when sold.

As a result of rises in house prices, four times as many first-time buyers are affected by the tax, which last had its lower threshold raised more than a decade ago, Alliance & Leicester found earlier this month.

The average house in the UK currently costs more than £150,000, but the £60,000 stamp duty threshold was set in 1993, at which time the average house price was £62,000.

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