Changes to the stamp duty system will help revitalise Huddersfield’s housing market, says a Huddersfield estate agent.

Chancellor George Osborne cut stamp duty for 98% of home buyers in his Autumn Statement this week – replacing a much-criticised “slab tax” with a “graduated” system that supporters say should enable sellers to be more flexible over price when putting their properties on the market without hitting affordability.

Under the previous system, stamp duty charged successively higher rates on the whole of the purchase price – meaning there were sudden increases in stamp duty when the price went above the next threshold.

For example, someone buying a home for £250,000 paid £2,500 or 1% in stamp duty. But if the price was higher by just £1 they paid an extra £5,000 as they had to pay 3% on the whole purchase price.

Now the new rates of stamp duty only apply to the amount of the purchase price that falls within the particular duty band.

So, someone buying a house for £200,000 will pay nothing on the first £125,000 and then 2% of the next £75,000 – giving them a stamp duty bill of £1,500. Previously they would have paid 1% on the total purchase price, giving them a bill of £2,000.

Following the changes, there is no stamp duty payable on properties up to £125,000 while it is now charged at 2% on properties priced £125,001 to £250,000; at 5% between £250,001 to £925,000; at 10% between £925,001 to £1.5m and at 12% above £1.5m.

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Alex McNeil, of estate agency Bramleys in Huddersfield, said sellers who had priced their property at £125,000 to avoid incurring stamp duty, might now put might them on the market at £130,000, knowing that stamp duty at 2% would only be incurred on the extra £5,000 – leaving the buyer with a bill of only £100.

He said the vast majority of buyers in Huddersfield would be saving money under the new system.

Said Mr McNeil: “The housing market has slowed a little bit over the last few three or four months. This measure will help the market and give people more confidence in the new year. It seems likely to be some time before interest rates go up again. Earlier in the year, there was talk about rates going up by now.”

He said: “A lot of first-time buyers who are having to find a higher level of deposit and budget for things like new carpets and kitchens will welcome the changes to stamp duty. The big problem at the moment is the qualifying criteria set by mortgage lenders, which is creating a bit of a backlog.”

Raymond Butterworth, of Boultons, said any reduction in stamp duty was to be welcomed, adding that changes would particularly help transactions around the £250,000 mark.

He said: “A lot of property prices have been held ‘artificially’ below £250,000 where vendors were losing out because buyers were not prepared to pay an extra £5,000 in stamp duty,” he said. “This will remove the negotiations that went on around the £250,000 mark because now it doesn’t make much difference between someone paying £245,000 and £255,000.”

Mr Butterworth said house prices in Huddersfield had inched up by 1% or 2% during the course of 2014, but that the increase in activity seen in he first few month of the year compared with January and February, 2013, had levelled off by the second half.