Brown introduces a stamp duty holiday

Mike, Brighton

It's the same as providing subsidies for investors in 1929.
Why buy a house now and save yourself some £1,750 when you could wait a year and the same house is maybe 10,20 or even 30% cheaper? Nuts

Faceless Bureaucrat

“Could it all be part of a scorched earth strategy, designed to leave nothing in the coffers for a Tory government? I certainly wouldn't bet against it.”

Neither would I – and does anyone really believe that Darling’s recent comment in The Grauniad that sent Sterling plummeting was an accidental slip of the tongue? In financial terms, we will soon be so weak as a Nation that joining the Euro and embracing closer integration within the EU will seem a natural progression.

A long game indeed…

Liz Brown

There is nothing in the coffers now, let alone what won't be there by the time of the GE...........
Some people might be impressed by this move but the majority will be wondering when and how they are going to be asked to pay for it

Familiar Clown

Ah, good! Now I can knock them down on that broom cupboard in Knightsbridge and save a bit.

Keith

Seems to me that if they wanted to revitalise the housing sector then stamp duty in its entirety should have been suspended for a year. That surely would move all sectors along.
Doubtless someone will enlighten me.

oldtimer

It is a fart in a thunderstorm. In other words it won`t have much impact and will leave a nasty smell.

Furthermore, temporary tax changes usually shore up trouble for later - as any student of the many manipulations of Purchase Tax, of distant memory, will recall.

The expectation of further falls in house prices, shortage of credit and a shortage of creditworthy customers are more likely to be dominant influences on the housing market.

The real solution is the permamnent abolition/curtailment of stamp duty on house purchases and the hated and useless HIPS. But this needs to be dealt with as part of a stringent review of government spending.

Alex R

Peter,

1) Will probably go down very well in the north and the midlands where, unlike the South East/London, you can purchase a family home for between £125,000 and £175,000

2) However, it is unlikely to kick start the housing market. In the pre-credit crunch days of 95% or 100% the max potential saving of £1,700 would have made a significant difference to the ability of a family to buy a home. Assuming a couple borrowing off 4.5 times combined income (or £37,500) the saving equates to c.5% of their pre-tax income. Moreover, in terms of the level of cash/equity needed to buy a home at the time – given there was no need for a deposit - it would have represented a significant chunk and might have tipped the balance between buying and renting.

However, in the post credit crunch days that same couple will only be able to borrow of 3.5 times joint income - i.e. c. £131,000. This leaves them needing a deposit of close to £39,000, which, coincidently, is equates to a 20% deposit; about the minimum deposit they would need to be putting down today to get a mortgage, irrespective of income multiples. So the couple are already trying to saving c.105% of their pre-tax income just for the deposit. Had they had to pay stamp duty as well, it would be c.110% of their pre-tax income – i.e. it is not going to make a material difference.

Probably the only people it will help are those who were already looking to buy and already had sufficient equity to put down a deposit: i.e. Buy to Let investors or those with family backing.

3) It is not going to help those selling a £170,000 property (unless the value of the property increases) – surely a requirement for someone being able to buy that £170,000 property.

4) Lastly, and more importantly, if you believed that house prices were going to fall another 10%, 20%, 30% or even 5%, why would you be enticed by the prospect of saving 1% of the value of property just to catch the falling knife?

This is nonsense.

Regards,

Alex

Hereford

So now the Government is doing what it berated the banks for doing only a few months ago. Facilitating onto the housing ladder, people who actually can't afford to be home owners.

This is just moving the crisis away by a few months or years.

The adult thing to do is to say, "Sorry, but home ownership is not something that everyone can aspire to and we are going to let the market drive itself."

your right move

Is the UK Economy Heading for a Massive Recession? Interesting article on Your Right Move site - http://blog.yourrightmove.co.uk/2008/09/is-uk-economy-heading-for-massive.html

UK Prime Minister Gordon Brown suspended a homebuyer tax and proposed spending 1 billion pounds sooner than planned to help reverse Britain's worst housing slump in at least 18 years.

Alan Phillips

It provides limiting workability for another reason, that the people selling homes at this price level (barring the buy to let investors wanting to get out) will still need to move else where. Those that have the homes will still take a hit and I believe the number willing to take a gamble will be small in number, even if they can get the mortgage.

Alfred T Mahan

A package this size is simply not big enough to affect the overall housing market, which will continue to decline. All it will do is to induce people who can't afford it to buy sooner rather than later, and so acquire a reducing asset, leading to negative equity. Just who does Brown think he's helping? It sure as hell isn't the poor, or first time buyers.

Ted Tedford

This will surely have a deflationary effect on houses in the £165-185,000 bracket. Agents will pressure sellers to reduce asking prices of £180K-odd to 'benefit' from the holiday - only a c5% reduction, after all. So houses that were on for around £175K will be reduced to reflect the cheaper prices of those 'better' houses. I would guess this would push a few more people into (hypothetical) negative equity.

Maisie

Nice bribe for the traditional Labour voters up North.

Utterly useless for the FTB in SE England.

cuffleyburgers

Sorry but you are all reading far too much into this and more than there really is.

Analysis and numbers and percentages are fine and dandy but also irrelevant.

This is a reversion to good old new labour. An eye catching iniative. A sound bite. A crock of shite.

They don't know whom it will help and they care less.

I would ask Osborne or Cameron to ask Brown exactly that. "Can the PM plse share with us his detailed analysis of how many deserving households will now be able to buy a house, who otherwise couldn't and how this will enable them to feed their children properly as a result rather than pringles and coca cola in front of the telly...? and how many of these will be in Labour marginals and how many in rural Tory heartland? How many in Glenrothes?"

david barker

A despearte measure by a desperate "Prime minister". As chancellor he presided over the massive house price bubble which was the cornerstone of an economic policy suggesting that not get rich as a nation by selling over priced houses to each other. Lets acknowledge this for the nonsense it is and try to rebuild the economy not artifically trying to pump house prices.

david barker

A despearte measure by a desperate "Prime minister". As chancellor he presided over the massive house price bubble which was the cornerstone of an economic policy suggesting that not get rich as a nation by selling over priced houses to each other. Lets acknowledge this for the nonsense it is and try to rebuild the economy not artifically trying to pump house prices.

Teledu

I'm no economist or accountant or estate agent, but wouldn't it make more sense simply to raise the amount people can earn before they pay income tax?
Let people keep more of the money they earn. If they're saving for a house deposit then they can reach it sooner. If they're not, then they'll have more to repay debts (mortgage/c.card etc.) and pay for essentials (fuel/food etc.) Or just save or buy other goods. Isn't this the way to reflate; to breathe life and confidence back into the economy?
Okay, maybe I'm naive, but the "experts" (Brown, Darling etc.) don't seem that smart either.

Silent Hunter

Is there no end to the amounts of OUR money this despicable excuse for a Prime Minister is willing to spend to save his skin?

He would beggar our children to hang on to power for a few more months...........we have got to get rid of this Criminal Labour Government and ensure that they never again get their grubby little hands on the levers of power in this country.

Verity

Yes, despicable prime minister, Silent Hunter, but you should also mention 'following 10 years as despicable Chancellor of The Exchequer.'

Interesting comments above. I will only add - as these headlice never give up spinning, "holiday". Nice, manipulative word.

Gordon Brown, the free emetic.