Homebuyers will not have to pay stamp duty on properties costing £175,000 or less for the next 12 months.
The current £125,000 threshold will be raised from Wednesday in a move aimed at kick-starting the housing market.
Someone buying a home for £175,000 will save £1,750 under the scheme, which is likely to cost the Treasury £600m.
The government estimates half of all property transactions will now be exempt from stamp duty – up from one third when the threshold was £125,000.
Prime Minister Gordon Brown said the package of measures – including help for first-time buyers and families facing repossession – showed the government was taking action to help people through difficult times.
“Home owners need to know that we will do everything we can to keep the housing market moving,” he told BBC News.
But the Conservatives – who say they would scrap stamp duty for first-time buyers on properties worth £250,000 or less – said the measures were a short-term survival plan to keep Mr Brown in a job.
Posted: 2nd September 2008