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The prospect of home finance assistance looms

The housing market has been a driver of the bouyant UK economy for several years now and if it falls into a period of sustained slowdown then it surely means bad news for the rest of the economy. With that in mind the Government is considering means that will help people make the house purchases they want without being too severely restrained by the difficulties in the banking sector. Reducing or even removing the burden of stamp duty is seen as one way of making home financing cheaper. Stamp duty increases on a scale according to the price of a property, but it's not a linear scale and sees homes valued less than £125,000 attracting no stamp duty. The next band of prices up to £250,000 attracts the duty at a rate of 1 per cent and raises around £ 1.3 billion for the Treasury every year. Increasing the zero rated band to include this level would be an expensive move but could help free up the market.

Some observers think interference in this way by the Government would be ill-advised and could be seen as encouraging buyers to enter a falling market which would ultimately cost them dearly in the long run. A more certain way of saving money over the long term is to make an extensive search for the best home loan before purchasing. Loans can vary widely in the interest rates they charge, so picking a cheap deal over a more expensive one can save thousands of pounds over the lifetime of the loan.