Increase of 1% may add €2,000 to cost of average home for new buyers, warn experts

NEW house buyers have been hit by the Government as the 1% increase in VAT may add up to €2,000 to the cost of an average home, experts warned last night.

Even though first-time buyers got a small boost from an increase in mortgage interest relief, the cost of what they buy is likely to go up by several thousand euro - which prompted one commentator to say that what Mr McCreevy gives with one hand is being pocketed again by the other.

The 50% increase in stamp duty to a new maximum of 9% on commercial property will not only hit businesses, but experts felt this extra cost would be passed down to consumers.