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Mortgage lenders welcome stamp duty reform

24 March 2006
The Council of Mortgage Lenders (CML) has welcomed the chancellor's decision to raise the threshold for stamp duty liability in his budget this week.

Gordon Brown announced that the value at which properties will not be liable for stamp duty at all on sale would rise from £120,000 to £125,000.

The move came after considerable clamour from the housing and lending industries for comprehensive reform of the stamp duty regime, particularly after it was revealed by Halifax that the average detached house costs more than the three per cent stamp duty threshold of £250,000 in most parts of England.

Deputy director general of the CML Peter Williams commented: "We welcome the chancellor's continued commitment to delivering shared equity schemes and increased home ownership."

However, he went on: "Although the stamp duty starting threshold has helpfully been raised, the number of buyers who would have escaped stamp duty last year as a result of the uprating is outweighed by those who became liable for stamp duty as a result of rising house prices."

The CML has estimated that some 29,000 home buyers would have been exempt from stamp duty had this rate been in effect last year.

Executive director Stewart Bernau of Nationwide acknowledged that the decision was a "step in the right direction", but argued that the increase should have been greater.

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