The scheme was introduced by the Labour Government in 2010 as a way to boost the housing market. It removed the 1% stamp duty tax for first time buyers on properties worth between £125,000 and £250,000.
Many buyers hoped the holiday would be extended but the Coalition Government has confirmed that it is being scrapped because it has not been as effective as expected in stimulating the market.
It’s thought there may still be a late surge as first time buyers try to beat the
deadline, and it’s likely that buyers already in a chain will want to speed
things up as much as possible to complete before the scheme ends.
First time buyers in this situation should ensure everyone in the chain is aware of the deadline and encouraged to avoid unnecessary delay.
Meanwhile, the Government is turning to other ways to stimulate the housing market.
It’s making £400m available for a ‘Get Britain Building’ fund which will help developers provide new homes. It’s also introducing a scheme in which the Government will provide indemnity for mortgages of up to 95% of the value of new houses. The scheme is expected to be launched on 14th March.
The Government also hopes to encourage more home ownership by increasing the discounts available under the Right to Buy scheme.
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