Chancellor Gordon Brown's abolition of stamp duty on property transactions in deprived parts of the UK has been branded a “cheap giveaway”.
The Treasury claims dropping stamp duty will revive depressed property markets and encourage families to live in disadvantaged areas.
But mortgage experts say few houses in such areas would be worth over £60,000 – the minimum for a property to incur stamp duty.
They fear regions exempted from the tax will become stigmatised, leaving existing homeowners unable to sell their house. Observers say the real beneficiaries will be landlords who can buy properties in depressed areas at a cheaper rate than before.
The Budget helps them by introducing a 5 per cent reduced rate of VAT for the cost of converting residential properties into a number of dwellings.
London & Country mortgage specialist David Hollingworth says: “It is a green light for landlords and developers to get stuck in.”