The stamp duty holiday has come to an end, meaning first time buyers will once again have to pay tax on properties worth between £125,000 and £250,000.
The initiative was introduced in 2010 in a bid to give the housing market a boost, and allowed first time buyers to save as much as £2,500 when completing their mortgage deal.
First time buyers will now have to go back to paying a 1% tax; for instance, a first time buyer purchasing a home for £185,000 will have to pay a tax of £1,850.
Recent figures show that many first time buyers looked to complete their mortgages before the stamp duty holiday came to an end.
The Council of Mortgage Lenders (CML) revealed that the number of first time buyers increased by almost a quarter (23%) in January compared with the same month in 2011, with 13,200 loans worth £1.6 billion being approved.
The CML and the National Association of Estate Agents both called for the stamp duty holiday to be extended, but there was no such announcement in last week's Budget.
Instead, the Government is looking to its NewBuy scheme to drive a recovery in the housing market.
The NewBuy scheme was announced as being 'open for business' last week by the Government.
It is hoped that the scheme – which will allow 100,00 buyers to secure their first or next step on the property ladder with deposits of as little as 5% - will give the mortgage market a much needed boost, while creating thousands of jobs for housebuilders.
The deal will mean that instead of a typical buyer requiring a £40,000 deposit for a £200,000 property, they will now only need £10,000.
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