Stamp Duty Holiday to come to an end

The stamp duty holiday, which has saved homebuyers thousands of pounds in taxes, is to be scrapped at the end of 2009.

Properties purchased between £125,000 and £175,000 have been exempt from the 1% tax since its introduction in September 2008. With many properties being keenly priced to take advantage of this tax break, buyers and sellers are being encouraged to wrap up their home buying and selling before the 31st December deadline.

The discount, worth as much as £1,750, often proves a big help to buyers, particularly those entering the property market for the first time.

Managing Director of the Spicerhaart Group, Russell Jervis, advises those thinking of entering the property market to act swiftly.

“Buying a property can take up to three months to complete, so it is make or break for those still undecided about buying a home.”

He added: “The ‘Prime’ service offered by our branches enables the time taken to complete a property sale to be reduced by up to 8 weeks, so we are urging buyers looking to complete before the deadline to talk to their local branch about suitable properties as soon as possible.”

Stamp duty is currently divided into tiers, with homes under £175,000 exempt, those between £175,001 and £250,000 being charged 1%, those between £250,001 and £500,000 being charged 3% and properties purchased above £500,000 attracting a 4% charge.

When the holiday ends, only homes purchased for £125,000 or under will be exempt from the tax. There has, however, been speculation that the government will extend the deal into 2010, in order to aid the encouraging signs of increased activity in the property market.

Any information on a potential extension to the stamp duty holiday will come in chancellor Alistair Darling’s pre-Budget report expected later this autumn.