Prime Minister Gordon Brown increases the stamp duty threshold and sets to help first time buyers

                                                                                         

The loans offered amount up to 30% of the value of the property and is interest free for five years, after which a fee will be charged. The government estimates that half of all property transactions will now be exempt from stamp duty, up from one third when the threshold was £125,000.

Effective of 3rd September people buying homes for £175,000 will save £1,750 under the new system, which will cost the Treasury £600m.

The announcement comes as the Prime Minister Gordon Brown attempts to improve Britain's housing market after poor opinion polls following the wake of the credit crunch. Figures from the Bank of England showed that home loans taken out were 71 percent down from last year. But surely offering substantial loans that incur an undisclosed fee after the five year period will only encourage first time buyers to get themselves into more debt?

Some of London's first time buyers are angry at the £175k threshold given for stamp duty exemption, stating that it's “close to impossible to find a desirable property in London under the £250k mark”, and that “it is all just a ploy to help developers meet the governments targets for affordable housing”. Others argued that the government should stop giving tax payers money away to buy up markets and that people should only be buying what they can afford in the first place. Admittedly this is easy for current homeowners to say who have not been effected by the intermittent property market.

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