Labour would ditch stamp duty for first-time buyers

27 Apr 15

Labour would scrap stamp duty for first-time buyers as part of moves to boost housebuilding if it forms the next government, Ed Miliband announced today.

Setting out the party’s housing plans, Miliband also confirmed he would give first-time buyers priority over new homes in their local area, and would also extend standard rental tenancies to a period of three years. Rent increases would be capped to the rate of inflation during this time.

Under today’s plans, Labour would reduce stamp duty to zero for first-time buyers for homes worth up to £300,000. This would save first-time buyers as much as £5,000, Miliband said.

In a bid to tackle ‘a crisis’ in supply of homes, Labour would undertake what Miliband called the biggest housebuilding programme in a generation by implementing the recommendation of the Lyons Review. This report called for town halls to be given power to buy land which has planning permission for homes but which has not been developed.

People who have lived in an area for more than three years would also be given first call on up to half of homes built, while taxes would be raised on foreign buyers and council tax increased for empty homes.

The current government has presided over the lowest level of housebuilding for almost 100 years and there was now the lowest rate of home ownership for a generation, the Labour leader said today.

‘No wonder people can’t get the start they need, working families deserve better. Britain can’t continue like this,’ he added.

‘Our plan is grounded in the idea that it is only when working people succeed that Britain succeeds. If we win the election in just a few days’ time, the next Labour government will make sure there are homes to buy and take action on rents.

‘We will start construction of one million homes over the next five years, so at least 200,000 homes a year are getting built by the end of the Parliament with a new generation of towns, garden cities and suburbs, unlocking land being hoarded by large developers, telling them either you use the land, or you lose the land.’

Responding to the announcement, a Conservative spokesman said the last Labour government had tried a similar policy of stamp duty holidays.

However, the coalition government had been able to cut stamp duty for 98% of people who would have paid following reforms announced by Chancellor George Osborne in last December’s Autumn Statement.

In a response to the plan to cap rents, Liberal Democrat campaign spokesperson Lord Paddick said the proposal was ill thought through and would make things even worse for tenants.

‘Rather than reduce rents, Labour’s plans will lead to huge rent hikes every three years, higher rents overall and fewer available rental properties,’ he added.

‘Labour consistently failed to support house building in government and their inaction left millions struggling to pay their rent.’

 

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