According to the council of mortgage lenders the stamp duty holiday, which was brought in by government ministers just over two months ago has failed to improve demand. Early in September a 1 year long stamp duty holiday was brought in for properties worth less than £175K.

The holiday failed to excite homebuyers with the number of new house purchases falling by 15% in September to just 34,900. The poor demand is further embodied by the fact that lenders on average only gave borrowers 84% of the value of the property. This means that first time buyers would need a 16% deposit in order to get on the property ladder. This is a huge some of money for most twenty something’s to get their mitts on. On a 200k flat in London this would amount to £32k.

In addition to this large obstacle, banks were also raising their fixed rate mortgage rates in order to safeguard profit margins. However, since the recent rate cuts more banks have started to pass on the benefits on to consumers.

In my opinion the stamp duty holiday was always going to be too little too late. They should have raised the bracket to £300k or be done with it totally in order to give it any chance at all of boosting the property market.

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