Stamp duty change helps mortgage hunters

13 November 2008

Finding a deposit for a mortgage became a bit easier in September, when the government raised the threshold for stamp duty.

As a result of that change, the Council of Mortgage Lenders reports, 51% of homebuyers paid no stamp duty at all in September 2008; in September 2007 only 22% of homebuyers had managed to avoid paying stamp duty.

Before the threshold was raised, stamp duty had been charged on all houses worth more than £125,000; the change meant that this figure was raised to £175,000.

"Stamp duty is charged at 1% for houses above the threshold and up to £250,000," said a mortgage expert for Think Money, "so it would now cost someone buying a £175,000 house nothing – rather than £1,750, as it would have before the threshold was raised.

"It`s a significant saving, which could really help homebuyers save up the kind of deposit which mortgage providers are requiring in today`s mortgage market."

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