Stamp duty threshold moved

Last Modified: 02 Sep 2008
By: Newsroom blogger

Inside the morning meeting

"The government has caught us by surprise this morning - although we are not sure how much that is down to its efforts to keep the stamp duty changes secret - or whether the decision was made late last night.

"They are saying it's the latter but you never know."

This relates to the government's decision to increase the stamp duty threshold from £125,000 to £175,000.

"We haven't looked at the costs yet so we don't know who much this is really worth, or whether it's a bit of a PR fiddle...

"We are around the country trying to get reaction to this, because the threshold changes do not really change things for home buyers in the south-east."

This is, of course, as much a political move as an economic one.

"Will this actually have an impact on the housing market? The last time the threshold was changed it doesn't seem to have had a major effect.

"And is this going against what Mervyn King [Bank of England governor] said? In that the last thing government should be doing is interfering in the housing market - we have old quotes from him on that."

Thoughts turned to where the policy came from.

"Is this a Tory policy again? Norman Lamont did it before - it just has the same sort of feel as the inheritance tax to me."

"It's difficult to know - because they don't seem to have any policies."

"Well, they have been banging on about it for the past 12 months, so I think it's as close as they get to a policy."

"Does this address the issue of why people are not buying houses though? It's because people just can't get a mortgage, and I'm not sure this will change that."

"This time last year first time buyers could get a 100 per cent mortgage, but now the best they can do is 90 per cent - which means they are looking at a deposit of £9,000.

"So if these changes save them up to £1,750 - they are still a lot further off being able to afford a house compared to a year ago."

The other big story of the day - and indeed yesterday - is the unfolding takeover at Manchester City, by the Abu Dhabi United Group for Development and Investment.

"There is actually a whole macro-economic trend you could tell through this story...

"The Arabs have got all the money these days - and other clubs owned by Americans like Man U and Liverpool are mortgaged up to the hilt."

"It's also an interesting rivalry between Abu Dhabi and Dubai - Dubai was supposed to be the main city in the Emirates but Abu Dhabi is coming through.

"The family from Dubai wanted to buy Liverpool, but now the others from Abu Dhabihave stolen in and bought Man City."