(Bloomberg) -- UK Chancellor Jeremy Hunt has pulled a series of levers designed to encourage fewer investors to buy holiday homes and existing owners to sell as residents in the country’s tourist hot spots struggle to buy their own properties. 

Hunt delivered a range of pledges at the House of Commons on Wednesday, including scrapping the furnished holiday lettings regime that gave tax breaks to people renting second homes out on a short-term basis. The chancellor also pledged to reduce the higher rate of capital gains tax to 24% from 28% on residential sales in a bid to encourage existing holiday home owners to sell, freeing up more stock for local buyers. 

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UK households are facing a stream of pressures — triggered by high interest rates, a cost-of-living squeeze and worsened by a housing shortage — which are pricing many out of homeownership. Meanwhile, the Conservative Party is bidding to claw back public support on housing, with the opposition Labour leading in the polls ahead of a general election expected this year, while shying away from radical measures to increase supply that risk angering existing homeowners. 

The chancellor said the government will abolish multiple dwellings relief — a sales tax relief designed to support investment for buyers purchasing more than one home in a single transaction — claiming it was “regularly abused”.

A much-rumored wider stamp duty cut — which would have spared more Britons from a homebuying tax burden — was not included in the budget. Shares in homebuilders including Persimmon Plc and Berkeley Group Holdings Plc gave up earlier gains once the statement concluded. 

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Hunt also said the government would allocate £242 million ($308 million) of investments in the Barking Riverside and Canary Wharf districts in London to build around 8,000 houses, in an attempt to transform the latter into a new hub for life sciences after the exit of some major banks. He also said the Conservative Party was on track to build over 1 million homes in this parliament, which works out to an average 200,000 per year over the five-year period and a shortfall of roughly 100,000 homes per year below the party’s own annual target.

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