27-04-04
Report on first time buyers shows need for Treasury action – Barrett
John Barrett, Liberal Democrat MP for Edinburgh West, today called on the Government to reform stamp duty after a new report found a third of would be first time buyers in Scotland are giving up hope of purchasing a house.
Research commission by the Clydesdale Bank found that surging house prices and increasing interest rates were dashing the hopes of many young people looking to buy their first home. 37% of would be first time buyers said they had given up hope.
However, on top of the costs of property and borrowing, most people are faced with the additional up front charges of stamp duty, the Treasury's tax on house buying.
Figures from the Edinburgh Solicitors' Property Centre (ESPC) show that stamp duty is now payable on many more homes than in the past. In 1993, when the £60,000 threshold for paying stamp duty was introduced, only 32% of the properties sold in Edinburgh were subject to the duty. Last year, 92% of properties sold by the ESPC were sold over £60,000, most them subject to stamp duty.
In a statement, John Barrett said:
"Buying your first home should be one of the greatest moments of your life. However, this report shows that many of first time buyers have given up hope. With the Capital's house prices, the 37% figure is probably even higher in Edinburgh, which is now the most expensive place in Scotland to buy property.
"As if this is not enough, the vast majority of first time buyers in the City are getting hit by a considerable stamp duty charge from the Treasury. After all, it is pretty much impossible to find a property in the City for less than the £60,000 threshold.
"The Government has to look closely at raising the various thresholds for paying stamp duty. Better still, the Chancellor should look at the option of exempting first time buyers from having to pay stamp duty altogether. That way, we can help young people to get their first step on the property ladder, just when they are starting out in life."
ENDS