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Darling's measures to help housing market
The Chancellor Alistair Darling (pictured) has said he is looking at a number of measures that could help the mortgage market.
Reports have suggested that a key component will be a temporary scrapping of the stamp duty paid by people buying houses.
Mr Darling said: “I'm looking at a number of measures. It's helping people that's important, so I want to look at a range of options that would help people.”
The prime minister is set to announce the postponement of stamp-duty and a tax-free savings account allowing first-time buyers a greater tax-free cash allowance to save towards a deposit.
Although the government has pledged that it would help people with housing and fuel bills, it has not worked out exactly what those policies will be.
The Treasury is costing options to defer stamp duty for lower value homes, however officials said that reports claiming tax would be axed for all properties was “wide of the mark”.
If stamp duty was to change, the most likely aspect of this would be the deferral of the one percent duty charged on properties of £125,000-£250,000, for an unspecified period of time.
Stewart Baseley, executive chair at the Home Builders Federation (HBF) said, “This is something the HBF has been championing for a number of months as one of a range of proposals to invigorate the housing market.
“It is a welcome initiative and shows that ministers appreciate the problems the current housing market situation is causing people looking to buy and sell properties, and the impact it is having on the wider economy.
“However, if it is to deliver the desired benefits, it needs to form part of a coordinated package of measures including crucially action to get liquidity back in to the mortgage market, as well as further steps to assist first time buyers and moves to ensure much needed housing production is maintained,” Mr Baseley went on to say.
Peter Bolton King, chief executive of The National Association of Estate Agents (NAEA), said: “The indication that the government is looking to suspend stamp duty is very encouraging.
“As an association we have been urging the government for some time to address the current situation facing the housing market by calling for measures such as stamp duty holiday.
“Therefore, it is great to see that the government has realised that the current circumstances facing the housing market are not going to simply disappear.
“Drastic action is needed in order to get the cogs whirring in the market place again. If this suspension does occur then it will provide a much-needed boost to consumer confidence.
“However, whilst this indication that the government may scrap stamp duty is positive, clear and immediate decisions in this area need to be made.
“Decisive action is needed today; one concern is that the anticipation of the suspension of stamp duty may halt the transactions in the housing market even further until the decision is finalised either way.
“Finally, although we welcome this news today we continue to appeal to the Treasury to carry out a complete overhaul of stamp duty,” Mr Bolton King went on to say.
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