Budget 2011: Boosts for property sector

A NEW shared equity scheme for first-time buyers was announced by Chancellor George Osborne today as well as measures to make the planning system more efficient.

Some 10,000 first-time buyers will be eligible for the Firstbuy scheme, however, the £250m government pledge to the scheme will only last for one year, the Budget documents reveal.

This would be funded by the levy on banks, Mr Osborne said.

Mr Osborne also announced stpes to improve the planning system.

These included the promise of a “presumption” in favour of sustainable development and the removal of national targets on the use of previously developed land.

The Chancellor has also proposed scrapping the 2% conversion charge on real estate investment trusts (Reits).

Neil Holyoake, tax partner at Ernst & Young in Leeds, said: “The proposed changes to make the REITS system simpler is welcome. The big question is will it open door to private REITS as at the moment the only ones are public.

“The Chancellor is still targeting stamp duty land tax and is tightening that up. He is revising the CGT regime for corporates which is probably going to have an effect on some of the big property groups.

“The Chancellors changes to stamp duty on homes of less than £250,000 are aimed at first time buyers and these measures recognise that the property sector is still struggling and we are starting to see some help for it.

“He is trying to refresh the market for first time buyers as much as he can.”