Property sellers are sticking to their guns when it comes to their asking price even though the stamp duty concession has now been withdrawn.

A recent study by Zoopla.com has discovered that sellers are offering smaller discounts and are less likely to drop the asking price of their house than they were 3 months ago. There had been concerns that sellers would be forced to take drastic measures when the stamp duty holiday came to an end, but so far, this has not materialised.

Zoopla discovered that sellers have reduced the price of 34% of the properties currently on the market. On average, these properties have reduced by 7.5% or £19,012.

Sellers in Newcastle have been forced to offer the largest discounts percentage wise. The average reduction in the city is 11.1%, which equates to £22,151. In Liverpool, sellers have also had to lower their expectations by more than the national average, knocking £14,031 off average asking prices.

In the Yorkshire town of Rotherham, 43.9% of sellers have made at least one price reduction.

However, over in Blackpool, only 26.1% of people who have their property on the market have reduced the asking price. The average discount in the seaside resort stands at 7.3%, just below the national average.

It could well be that the housing market has yet to feel the full impact of the withdrawal of the stamp duty holiday. After all, it did not take effect until the end of March. Zoopla is still expecting transaction levels to remain low for the remainder of the year, due to continuing economic uncertainties.

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Despite the problems associated with getting a contractor mortgage, and a weak housing market in the UK, a record number of homes were bought last year costing more than £2 million.

Estate agents have expressed concerns that the rise in stamp duty on high price properties could disrupt property chains, but the latest research from Lloyds TSB suggests that the top end of the market was largely immune from the problems most buyers faced in 2011.

1,518 properties were sold last year that cost at least £2 million, up 5% on the number the previous year. Out of those, 156 were sold for more than £5 million. In comparison the total number of sales in the UK fell 4% to 698,200.

It will come as no surprise to learn that the majority of these high-end sales took place in London. Compared to most areas of the UK, house prices in the Capital have increased thanks to continuing demand from foreign buyers.

The Lloyds TSB study estimated that Britain has 38,000 homes worth at least £2 million and these would all be subject to stamp duty at 7% if their owners put them up for sale.

Suren Thiru, a housing economist for the bank, said the results show that the top end of the market remains strong. Wealthy cash rich buyers and a lack of supply have ensured that this section of the housing market is reasonably immune from the turmoil faced by most house buyers.

Strangely enough, sales of £1 million properties decreased by 5% last year to 6,911. The only regions where million pound sales increased were the East Midlands, the North East and Wales.

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While people with older properties have seen thousands wiped off their value in the last couple of years, the price of new-builds has increased by 7.7% over the past 12 months.

There are now fears that first time buyers who take advantage of government initiatives could end up in negative equity.

As home owners with a contractor mortgage will be well aware, data from the ONS shows that house prices are flat or falling depending on the area. The government has intervened to help first timers in a bid to kick start the housing market, but the majority of their measures centre around newly built properties and they are increasing in price. Whilst builders are benefiting, young homebuyers could be left with inflated debts.

The ONS statistics show that the average house price in Britain rose by a mere 0.3% in the year to February, but the average price of a newly built property increased to £221,247. The figures also confirm a 20% increase in sales of new-builds. The stamp duty holiday no doubt contributed to this increase.

The Government recently launched the NewBuy Guarantee scheme, which is designed to help people get a 95% LTV mortgage on newly built properties valued at up to £500,000. The idea behind the scheme is to attract first time buyers who are fed up with renting. But there is still a very real danger that when interest rates rise, these buyers will be stuck with a mortgage they can no longer afford, and if house prices fall again, a property they are unable to sell.

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According to the RICS, demand for property in March reached its highest level since 2010 as people rushed to buy before the stamp duty holiday came to an end.

Enquiries from first-time buyers rose as did those from existing contractor mortgage owners thinking of moving home. However, it remains to be seen whether this increase in activity can be sustained throughout the rest of the year.

London still outperforms the rest of the UK housing market, but the north-west also recorded increased activity last month. There are still regional variations and interest from buyers in East Anglia, the north of England and Scotland appear to have all but dried up.

Despite increased demand, the RICS reported that house prices decreased in all areas except London. Hometrack on the other hand reported that prices rose by 0.2% across the UK.

It’s not easy to work out what’s going on with house prices. Lloyds TSB has conducted research that shows that only 40% of towns have registered year-on-year increases in house prices, compared to 82% in 2010.

With all these differing reports, its not too hard to see why the housing market remains flat. First time buyers are no doubt concerned that if they buy now they’ll run the risk of ending up in negative equity and people who are considering selling will want to wait until they see house prices recovering before they out their property on the market.

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People looking for a contractor mortgage may be interested to hear that house prices rose in March for the first time in 21 months. At least, that’s according to research by Hometrack, the property tracking website.

The website’s research showed that average asking prices rose by 0.2% compared to February, after two months where they remained unchanged. The rise was attributed to the end of the stamp duty holiday.

House prices in London increased by 0.5% in March, but despite the average increase, only 4 regions recorded rising prices. When taken on a year-on-year basis, prices were actually down by 1%.

New buyer registrations increased by 4.4%, but this was well down on February’s figure of 18.1%.

However, figures from the Nationwide completely contradict the above! According to the Building Society, prices dropped by their greatest amount in two years after the stamp duty exemption ended.

The reintroduction of stamp duty on first time buyer properties valued at between £125,001 and £250,000 could further stifle the already struggling housing market. Confidence levels amongst UK consumers fell in March and are now at the same weak level we witnessed in the latter months of last year.

It must be extremely difficult for people to get a handle of what exactly is happening in the housing market when we get contradictory reports.

Robert Gardner, an economist for Nationwide, predicts that house prices could increase later this year if the economic recovery gets into full swing, but he thinks they will be unchanged, or even slightly lower, this time next year.

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The stamp duty holiday has come to an end so first time contractor mortgage borrowers have to fork out more money to buy their dream home.

For the last couple of years, first time buyers had been able to buy a property valued at £250,000 or less and not pay stamp duty. However, as from March 25th, properties costing between £125,001 and £250,000 once again attracted a 1% stamp duty levy.

Enter the Halifax to the rescue; or is it? The Halifax has offered to pay 50% of the stamp duty levied on first time buyers. However, prospective buyers should do their maths before rushing to take up this deal. The lender is offering a two year fixed rate home loan on 85% and 90% LTV mortgages and no fee is payable. But the interest rate is a whopping 5.99%. The repayments on a £150,000 mortgage would work out as £966 a month!

The Co-operative Bank has recently launched a couple of 90% LTV, fee free mortgages. Its lifetime tracker mortgage tracks at 4.09% above the Bank of England base rate. Monthly repayments on a £150,000 loan would work out as £841. It also had a three-year fix at 4.69% giving monthly repayments of £850.

Whilst the Halifax deal would save you £750 in stamp duty, opting for a cheaper mortgage rate could result in bigger savings in the long run.

It always pays to do your homework in advance and take the fees, interest rate and benefits into consideration before signing up for a mortgage.

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Mortgage lending continued to increase in February as first time buyers rushed to complete their purchases before stamp duty holiday came to an end of the 24th of March.

According to the CML, financial institutions lent £10.7 billion for residential contractor mortgages in the second month of 2012, a year on year increase of 14% and the seventh consecutive month where year on year figures registered an increase.

Bob Parnell, the chief economist at the CML, explained that mortgage lending usually declined during the winter months, but it has remained brisk as people tried to take advantage of the stamp duty exemption on properties costing up to £250,000.

The Newbuy scheme may help to offset some of the damage the end of the stamp duty holiday could cause, he added.

It is hoped that the Newbuy scheme will breathe life into the newly built property market. Mortgage lenders are starting to show signs that they genuinely want to grant home loans and demand for properties is starting to pick up slowly.

A lot of prospective buyers seem to have been holding back in the hope that the housing market would show signs of improvement. We’ve seen the return of 95% LTV mortgages and although rates have started to edge up, there are a number of good deals still available to buyers who are prepared to shop around.

We’ll have to wait and see whether the removal of the stamp duty holiday does have a drastic impact on lending but hopefully the upward momentum we’ve witnessed in recent months will continue.

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Are you brave enough to build your own home? If so, you could avoid stamp duty and make an instant profit!

One couple that wanted to do exactly that bought a plot of land in Devon just over 13 months ago. They now own an eco-property with four bedrooms. It cost them a total of £385,000 to construct and that included the cost of the land and all the fees. The house would cost more than £400,000 if you looked on the open market for a comparable new property.

The couple found their plot through BuildStore and got their contractor mortgage through the company. There are currently over 8,000 plots on the BuildStore website with prices as low as £6,250 in County Fermanagh. Providing the plot costs less than £125,000, there will be no stamp duty payable.

Some mortgage lending companies have pulled out of the self-build market but Building Societies such as the Norwich & Peterborough and the Leeds still lend to people who want to build their own property.

The Norwich & Peterborough offers an 80% LTV tracker mortgage at 4.39% above base, plus arrangement fee of £795. The Leeds Building Society deal is a 75% LTV variable rate at 6.19% with a £999 fee. Both these mortgages are released in instalments and in arrears.

BuildStore itself has an Accelerator loan where funds are released before the work is done. Borrowers can get a 75% LTV mortgage at a variable rate of 5.24% over three years. There is an administration fee of £495 with this deal plus a 1% completion fee on top.

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People currently looking for a contractor mortgage were no doubt hoping that George Osborne would change his mind and extend the stamp duty holiday.

Unfortunately a last minute reprieve was never really on the cards. All good holidays have to come to an end and as from the beginning of next week, first time buyers will have to pay stamp duty on properties costing more than £125,000.

However, the Chancellor did make some changes to stamp duty that will affect wealthy property seekers. As from midnight last night, the Stamp Duty Land Tax rate on properties valued at more than £2 million will be 7%. Furthermore, anybody who tries to avoid stamp duty by purchasing an expensive residential home through a company will find themselves paying a rate of 15%!

He explained that people buying residential property were expected to pay stamp duty and if they try to find inappropriate ways of getting round these new rules, he will act quickly.

The Chancellor reminded us that the government has already introduced measures to help first time buyers; such as the New Buy Scheme and a revamped Right to Buy. Furthermore, the coalition has decided to expand the Get Britain Building Fund to finance the construction of new homes.

This budget may not have contained any measures to boost the housing market but it also hasn’t really done anything to hinder it. The only people who will have received an unwelcome surprise are those with the expensive properties most of us can only ever dream of owning.

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The stamp duty holiday comes to an end on March 24th and the Nationwide Building Society has leapt to the rescue by offering £1,000 to first time buyers who take out one of its contractor mortgages.

This is a limited time offer and is only available to first time buyers with at least 10% deposit. The buyer must already operate, or open, a Flex Account with Nationwide as their main current account and they must reserve a fixed rate mortgage with the Society.

However, this deal may not be as good as it seems. £1,000 to offset against the cost of stamp duty sounds good, but once you take interest rates and fees into consideration, there are better deals around.

Nationwide offers a two-year 90% LTV fix at 5.89%, plus a fee of just £99. HSBC’s two-year fix for buyers with just 10% deposit has a rate of £4.49%. The fee for that deal is £599. But even if you factor in the £1,000 incentive, the HSBC deal will still save a borrower with a £120,000 home loan £880 over the two years.

Meanwhile, George Osborne will probably act to close a loophole that has allowed people to avoid paying stamp duty. It’s not the ordinary man in the street who’s been avoid it, but wealthy property owners who transfer ownership of their home to offshore companies.

There are also numerous websites offering to save purchasers thousands in stamp duty, providing you pay them a hefty fee. HMRC apparently is aware of these schemes and will be pursuing people who take advantage of them.

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It’s not only first time buyers who have been struggling to get a contractor mortgage in recent years; first time sellers have also had problems.

Lloyds TSB recently conducted a survey that found “second steppers” who long to upsize are stuck in accommodation which is no longer suitable. A lot of these people bought when prices were high and may now be in negative equity. A lack of buyers and the additional costs associated with moving home are also holding others back.

Lloyds’ research findings suggest that 61% of second steppers wanted to move to a larger home over the last 12 months. 20% of second steppers think it’s harder to climb to the next rung of the housing ladder than it was to get on it originally.

Stephen Noakes, Lloyds TSB’s mortgage director, said home owners selling for the first time face some tough challenges and it is important for this group to receive more support as they have a vital role to play in making the housing market move again.

Another study, this time from HSBC, found that falling house prices and tough mortgage lending criteria have prevented 360,000 home owners from moving up the housing ladder.

Although a lot of these are not actually in negative equity, they do not own enough of their home to fund a 10% deposit, stamp duty and other expenses. The problem has been made worse because typical first time buyer homes have decreased in value at a faster rate than other properties.

HSBC’s head of mortgages, Peter Dockar, pointed out that people who are already in their first home can no longer depend on rising house prices to fund the deposit for their second.

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People with a contractor mortgage may be interested to learn that the debate about the controversial mansion tax is hotting up in the run up to this month’s Budget.

The Lib Dems want George Osborne to introduce a mansion tax on properties valued in excess of £2 million. However, according to a Sunday newspaper, the Treasury has ruled out the plan as it would be expensive to introduce and could lead to legal challenges against the government.

Nick Clegg has repeatedly called on the government to increase the personal income tax allowance to £10,000 and the mansion tax would fund that proposal.

The government has also recently discovered a tax loophole whereby properties are placed offshore to avoid stamp duty. Still on the subject of stamp duty, the UK200 Group recently commented on the way homeowner envelope their properties to avoid the 5% stamp duty charge on house prices above £1 million, and instead paying only 0.5% duty.

Meanwhile, first time buyers are rushing to beat the stamp duty holiday and estate agents reported a 18% increase in registrations last month. However, Hometrack has acknowledged that this is an artificial increase.

Demand in the housing market is now exceeding supply and 92.9% of sellers achieve their asking price. In fact supply has only increased by 1.5% over the last six months and yet last month alone saw a 28% increase in the number of first time buyer enquiries in the South East.

House prices in Greater London managed to increase by 0.1% in February, the only region to register a rise, whilst they fell by 0.3% in the North East.

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