Cut duty on efficient homes - thinktank

HOMEBUYERS should be rewarded with a discount on their stamp duty bill if they are buying a more energy efficient home, a thinktank has suggested.
By The Newsroom
Published 2nd Mar 2016, 02:58 BST
A thinktank has suggested stamp duty should be cut for energy efficient homesA thinktank has suggested stamp duty should be cut for energy efficient homes
A thinktank has suggested stamp duty should be cut for energy efficient homes

Policy Exchange argued the move would help drive consumer interest in energy efficiency and encourage more homeowners to invest in insulating their properties.

The thinktank estimated the idea could lead to as many as 270,000 homes a year being made more energy efficient.

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In a report published today it suggested homebuyers could receive a £500 discount on the stamp duty charged on a house bought for £220,000, the average price paid in the UK.

The policy would be paid for by charging higher levels of stamp duty on properties judged to be the most inefficient. The money could be paid back if improvements were made within 12 months of the house purchase.

The maximum increase or discount would be £2,500, Policy Exchange recommended.

Report author Richard Howard said: “Improving home energy efficiency can save households money, as well as substantially reducing their carbon emissions. Policies which link property values more closely to energy performance could kick start an energy efficiency revolution in this country.

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“By reducing the transaction costs and increasing the mortgage available for a more energy efficient home, the government could nudge people into making improvements to the efficiency of their home, which would not only add a premium to their property but would also reduce their energy bills.”

The report also suggested mortgage lenders should be encouraged to relax affordability tests for efficient homes.