‘Axe stamp duty for OAPs’ to ease the housing crisis

Stamp duty should be waived for millions of pensioners to encourage them to downsize, a group of mps said last night.

they quote analysis that found a third of over-60s want to move into smaller houses but are put off because of the large amount they have to pay in tax.

It means they continue to live in familysized homes which are far bigger than they need and are costly to heat.

the all-party parliamentary group on housing and care for older people said the answer was to exempt them from stamp duty on homes worth £250,000 or less.

they could then move into smaller homes more appropriate to their needs – freeing up their larger houses for families who need more room.

the Help to move idea is contained in a report by the all-party group, which is chaired by Lord Best, the former head of the Joseph Rowntree Foundation. It suggests measures to help to free up more than four million family homes.

‘ more and more people i n their “extended middle age” are thinking about downsizing,’ said Lord Best. ‘this can mean much reduced fuel bills and maintenance costs, perhaps the release of some capital, and can prevent a forced move in later life.

‘Our report recommends a Help to move package of stamp duty relief, financial advice and mortgage support – like the Help to Buy assistance for younger purchasers – to generate the demand that will get more high-quality homes built for this age group.’

the report cites analysis by the thinktank Demos that shows 58 per cent of over-60s – eight million people living in

‘Affordability is a major barrier’

seven million homes – are interested in moving. a third of over-60s wanted to downsize, while a quarter said they were interested in buying a retirement home.

the mps say exempting older people from stamp duty on homes worth up to £250,000 would lead to a net gain to the treasury because of the consequent moves in the property market.

Scottish Finance Secretary John Swin- ney plans to replace stamp duty with a Land and Buildings transaction tax.

there will be no charge levied on properties bought up to £135,000, with 2 per cent charged on the part of the price between £135,001 and £250,000.

the rate jumps to 10 per cent for the next £750,000 tranche, up to £1million, before increasing again to 12 per cent.

the Demos report also calls for loans for older homeowners with lower value properties to let them get mortgages to buy higher-value retirement homes.

at present, many older people cannot access mainstream mortgage lending. the report said a scheme like Help to Buy, which helps younger people get on the housing ladder, could help pensioners at the other end of their lives.

Claudia Wood, chief executive of Demos and author of the report, said: ‘politicians are committed to helping first-time buyers get onto the housing ladder, while ignoring the problems at the other end of the market.

‘the government needs to commit to helping this group of people, not just to ensure older people enjoy a better quality of life but also to stimulate their housing market by helping older people move from family-sized homes. affordability is a major barrier for many.’