CML: Stamp duty should be abolished, may affect first-time buyers

31-Dec-2009

The British body for mortgage lending has called for a "fundamental reform" of stamp duty as the holiday comes to an end in a move which may affect first-time buyers.

However, in its review of the tax holiday the day before the threshold returns to original levels, the Council of Mortgage Lenders (CML) revealed the cost of the concession - approximately £500 million - is far below the government prediction of £615 million.

And the benefits of the holiday were ultimately down to one's geographical region - 75 per cent of transactions in the north are currently exempt from the higher stamp duty compared with just 17 per cent of London residences.

The CML’s senior analyst James Thatch predicted a "surge of activity" today as customers rushed to take the last opportunity of the lower threshold - which may include those trying to get on the first rung of the property ladder.

But he said it would not make up for the disappointment of the stamp duty holiday.

The CML said it still believed "abolition was the best option".

Earlier this year it revealed first-time buyers were putting a record 25 per cent deposit down on their properties.

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