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The latest Budget brought little relief to millions of homeowners in the UK facing raising rates and dropping house prices.

Chancellor Alistair Darling’s first Budget, made little changes to the UK mortgage market – stamp duty and help for better mortgage products was entirely lacking from the Chancellor’s agenda, which has angered mortgage professionals and homeowners alike.

One industry figure says: “The Government’s failure to bring in more measures to help create cheaper mortgages and to adjust the stamp duty rate in this Budget for the majority of buyers means that those looking to raise funds to buy a house continue to face an uphill battle.”

Many felt the only way the Budget would help homeowners is to cut the costs of crippling stamp duties that most Brits now have to pay through the nose for.

Recent reports from the Council of Mortgage Lenders show that the average stamp duty bill for first-time buyers has almost doubled over the last five years. Also, the total stamp duty revenue from residential property sales in the UK rose by 40% in 2007 to a record £6.4 billion.

Nici Audhlam-Gardiner, director of mortgages at the Abbey, says: “The current slab taxation system is unfair. For example, if a buyer pays just £1 more from £249,999 to £250,000 – their stamp duty rises from £2499 to £7500 – a 200% increase.  This penalises all buyers, but for first-timers who are already struggling, it adds to the burden.”

Stephen Leonard, director of mortgages at Alliance & Leicester, added: “First-time buyers are the life blood of the housing market. The stamp duty threshold of £125,000 is 25% below the average house price for the first-time buyer which stands at £167,000 today.”

Instead of addressing taxation, the Chancellor outlined plans to promote unpopular, long-term fixed mortgages. Darling wants homeowners to move from short-term deals in an attempt to beat any rate changes on the horizon.

He says: “It is at this time that we need to do more to promote longer-term stability for home owners and mortgage holders.”

“I want more people to have the choice of long-term fixed rate mortgages,” he adds. “These protect borrowers from risks and still allow them flexibility to move, or get a new mortgage if rates go down.

“The conclusions show that long term fixed rate mortgages can reduce some of the risks of taking out a mortgage, especially for first time buyers and lower income families. And it will help more people get on – and stay on – the housing ladder.”

But industry figures disagree that long-term fixed rates are the answer to the impending housing crisis.

Louise Cumming, head of mortgages at moneysupermarket.com, says: “It’s sad to see the Chancellor beating the same old drum about 25-year fixed-rate mortgages without having any understanding of the industry. There are already ten 25-year fixed-rate deals on the market – and people just don’t want them.”

“Stamp duty is taxation gone mad,” concludes Peter Bolton King, chief executive of the National Association of Estate Agents. “This government needs to realise that the housing market is slowing and the gravy train is over. This was an opportunity for the Chancellor to give the housing market the boost it really needs to keep the market moving but he has failed the British homeowner again.”

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