Stamp duty will be abolished immediately for first-time buyers buying a home of up to £300,000, Chancellor Philip Hammond has said.For properties costing up to £500,000, no stamp duty will be paid on the first £300,000.Mr Hammond said this meant 95% of first-time buyers would see stamp duty cut, while 80% would pay none at all.The change will apply in England and Northern Ireland, and in Wales up until the end of March, but not in Scotland.The maximum saving, according to the Treasury, will be £5,000.”This is our plan to deliver on the pledge we have made to the next generation that the dream of home ownership will become a reality in this country once again,” Mr Hammond said.Live: Budget reaction and analysisWhat the Budget means for youAt a glance summary: Budget key pointsRegional differencesEstate agent Savills estimates that the average stamp duty bill for first-time buyers is about £2,700. But in many parts of the country, first-time buyers will see no – or very little – saving at all.In the North of England, the average Stamp Duty charge is currently £11.82, according to analysts at AJ Bell.This is because average house prices are only just above the English Stamp Duty threshold, at £125,000.
However, buyers in London who spend £500,000 could theoretically save £5,000.”The stamp duty relief for first time buyers announced in today’s budget will be a welcome boost to people purchasing their first home but the impact will be felt disproportionately in the south of England,” said Tom Selby, senior analyst at AJ Bell.Market boostFor all first-time buyers, the deposit is a bigger up-front cost than Stamp Duty. The average deposit across the UK is £32,899, according to the Halifax, compared to the average Stamp Duty charge of £1,654.Tom Kibasi of the centre-left think tank the Institute of Public Policy Research (IPPR) said: “Unaffordable house prices are the problem, not Stamp Duty. For most young people, the stamp duty cut will make little difference. “But it will help the beneficiaries of the bank of mum and dad.”The change could stimulate the lower end of the housing market.The Office for Budget Responsibility (OBR) said the Stamp Duty change would add 0.3% to house prices.