As the Chancellor, Philip Hammond alluded to in his Budget speech there had been much speculation in the press that he would do something to alleviate the Stamp Duty Land Tax (SDLT) burden for first time buyers.
However, he went a step further by introducing a temporary freeze in SDLT. SDLT for all first-time buyers making a purchase of up to £300,000 will pay no stamp duty under the new proposals. He also added a little extra cheer by extending the relief to the first £300,000 of the purchase price on properties valued at up to £500,000. This is an effective reduction of £5,000 in SDLT for a first-time buyer of a house valued at between £300,000 and £500,000.
This measure is intended to help young people buy their first home and to help revive the home-owning dream in Britain after years of decline. The relief was introduced with immediate effect from the 22 November 2017 Budget date. There is no SDLT relief available for first-time buyers spending more than £500,000 on a property.
The measure applies to first-time buyers in England, Wales and Northern Ireland. It remains to be seen if Scotland will introduce similar measures and if the Welsh Assembly will mirror these changes when the new land transaction tax (LTT) which will replace the SDLT is launched on 1 April 2018.
The Chancellor also pledged another £10 billion for the Help to Buy equity loan scheme to help those saving for a deposit to buy a house.