For nearly a year now, the property tax associated with buying a house up to the value of £175,000 has been frozen - but this embargo is soon to be lifted.

David Amstell, founder of online property website Briffy.com, said that once stamp duty has to be paid again at the start of 2010, people could be discouraged from purchasing property.

"I expect that the market will have to adjust itself and the vendors will have to suffer some of that increased cost and just accept [it],"he explained.

As well as property tax, landlords have a number of fees to pay - such as money to letting agents and payment to maintenance men - so the end of the stamp duty holiday will add to the expenses list for some.

HM Revenue &Customs' rules state that there is currently a one per cent stamp duty on properties purchased between £175,000 and £250,000, while a three per cent property tax is placed on homes bought between the prices of £250,000 and £500,000.

Properties bought for between £125,000 and £175,000 will incur a one per cent tax from January 1st 2010.

Written by John Weeks
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