Stamp Duty: mystery surrounds PM’s “16,000 first timers helped” claim

Mystery surrounds a claim made by Prime Minister Theresa May that the stamp duty changes for first time buyers made in November’s Budget had already helped some 16,000 buyers.

During his Budget the Chancellor, Phillip Hammond, announced the abolition of stamp duty for all properties up to £300,000 bought by first time buyers with immediate effect.

Those FTBs spending up to £500,000 – therefore including London first time buyers in particular – would benefit from not having duty applied to the first £300,000 of the purchase price.

At the time the independent Office for Budget Responsibility warned that the move risked increasing average house prices by 0.3 per cent because it was fuelling demand without addressing the shortage of supply. In addition, it said the move could create only 3,500 additional purchases per year.

However, the Prime Minister yesterday produced a much higher figure for the number of purchasers who had apparently already benefitted from the move – within six weeks of the Budget, including the holiday season.

Yesterday she said over 16,000 first time buyers had already saved thousands of pounds as a result of stamp duty changes.

This is despite the fact that it takes some time for transactions to reach completion – and a range of commentators suggesting that the move would make only limited difference to the market.

HMRC says 99,540 transactions took place during November but the duty exemption existed only for the final eight calendar days, and of course only for first time buyers.

Figures for December are not available yet – even to Downing Street.

Visiting Wokingham in Berkshire, Theresa May said:

“I have made it my personal mission to build the homes this country needs so we can restore the dream of home ownership for people up and down the UK. In the autumn we set out ambitious plans to fix the broken housing market and make sure young people have the same opportunities as their parents’ generation to own their own home.”

Labour has dismissed the government’s figure, with housing spokesman John Healey claiming:

“The number of young home-owners is in free-fall but under the Tories the number of new low-cost homes for first-time buyers has halved and not a single one of the 200,000 ‘starter homes’ promised has been built.”

Kindly shared by Estate Agent Today