In a move to help tax payers out before the General Election, the Chancellor removed the stamp duty on first time home buyer mortgages for homes that cost under £250,000 as of March 25^th at midnight.  The stamp duty will be eliminated for the next two years, which will allow many first time buyers to look at affordably purchasing a home.

The move to end the stamp duty will receive funding by increasing the amount of stamp duty due on mortgages that are over £1m.  These home buyers will now pay 5% more on duty, which is roughly £50,000 for a million pound home.  The increase in taxes will come into play next April for all homes purchased.

The new stamp duty arrangements were created in order to help first time home buyers who have a hard time scrapping together a large deposit and are facing difficult securing a mortgage.  Without the stamp duty homes will be easier to purchase with a lower upfront down payment.

The typical home is £160,000 on average, which means that nine out of ten homeowners will benefit from the current suspension of the stamp duty on homes.  Only the South East and London homes have an average cost that is above £250,000.

It is estimated that the move will cost the government approximately £750m in duty revenues.  However, market professionals welcomed the move, stating that it will help many first time buyers fulfil their dream of owning a home.

In order to be approved for the new stamp duty reduction, mortgage seekers must not have owned a home before both overseas and within the UK.  They also must fill out a form that is checked by the HM Revenue & Customs that lists all past residences.