Stamp duty will be scrapped immediately for first-time buyers of homes below £300,000, as the Chancellor put Britain’s housing crisis at the heart of today's Budget.
Philip Hammond said the move would cut the tax for 95 per cent of first-time buyers – and abolish it altogether for 80 per cent of them.
“When we say we would revive the home owning dream in Britain, we meant it,” he told the Commons.
Mr Hammond added that, in London and other property hotspots, stamp duty would be axed on the first £300,000 of a purchase price up to £500,000 – a cut of up to £5,000.
The move came as he promised a wide-ranging package to boost housebuilding, setting a target of an annual 300,000 homes built by the middle of the next decade.
Higher capital funding, loans and guarantees, plus measures to boost the supply of skills, resources and land, would add up to £44bn, he said.
Kris Brewster, Skipton's head of products, said: “We welcome any move that supports and strengthens the UK housing market. For too long, young people are being priced out of buying their own home. Many more simply have a lack of choice and availability of affordable housing in their area.“First time buyers are the lifeblood of the housing market. And any step that makes getting the keys to your first home easier is to be welcomed. However, it’s important not to lose focus of all the factors at play. In order for first time buyers to get on the bottom rung of the housing ladder, we need to see the promised level of new house building being met, together with the capability for next time buyers to move up the housing ladder."
Anthony Rushworth, founder of housebuilding investment platform Homegrown, said: “There are plenty of reasons for first-time buyers to be jumping for joy on the face of it but, in reality, they only pay Stamp Duty of £1,500 on average.
“Sparing them from this tax might not cause the Exchequer any loss of sleep but all this will likely do is feed into higher prices for the narrow band of properties they are fighting over.
“This is the problem with strategies that boost demand without addressing the fact there are too few homes being sought by too many buyers.”