Hammond defends stamp duty cut for first-time buyers

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Prior to this budget it was paid by anyone buying a property costing more than £125,000 and adds £2,020 to the upfront cost of a £226,000 home - the current United Kingdom average price.

"We do not underestimate the scale of the challenge, but today we have made a substantial down-payment".

Chancellor Philip Hammond also confirmed that first-time buyers wishing to buy a home at a maximum of £500,000 would not be taxed on the first £300,000.

Faced with evidence showing that the United Kingdom will be one of the weakest growing major economies in the next five years, the chancellor announced a modest increase in funding for the NHS, and announced £15bn of measures to tackle the housing crisis.

The average house price in London is almost 500,000 pounds, around 15 times the average London salary, according to official data, making many areas of the capital unaffordable to young people.

In its biggest downgrade since its creation seven years ago, the OBR said earnings and living standards would be squeezed hard over the next two years, even if the government succeeds in striking a Brexit deal with other European Union member states.

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Britain's official budget watchdog, the Office for Budget Responsibility, said the stamp duty cut could in fact push house prices up, meaning the total cost of buying a home would rise for first-time purchasers even with the tax reduction.

To assist "those who will need to save for years", he introduced a new threshold for first-time buyers which is more than double the £125,000 point at which the tax normally kicks in.

£44bn worth of capital funding to boost housing supply to 300,000 new homes a year by the mid-2020s.

"The whole industry has needed a radical overhaul for years and the news that all first-time buyer purchases, up to £300,000, will have no stamp duty to pay is welcoming for those struggling to get on the property ladder..." As well as predicting that they would see an uplift of 0.3% in house prices, the OBR also stated that the number of first-time buyers to benefit from the change would be minimal, at an estimate of just 3,500. On top of the Help to Buy scheme and other incentives already in place, abolishing stamp duty up to £300,000 is a positive step from the government to help this group of buyers onto the housing ladder.

Thousands of first-time buyers using shared ownership schemes are set to miss out on the Government's stamp duty exemption because the two policies clash.