The government has scrapped stamp duty on properties costing £175,000 or less for the next 12 months, in a bid to revive the flagging housing market.

The policy would mean half of all properties are now except from stamp duty rather than the third that came under the previous limit of £125,000, the government claims.

The move was part of a package of measures which also included interest-free loans of up to 30% of a property's value for first-time buyers of new homes in England for households earning less than £60,000.

The power of councils and housing associations was increased to include paying off debt for homeowners who cannot afford payments and then charging them rent while the period before income support for mortgage interest payments can be paid was reduced from 39 to 13 weeks.

The government also announced plans to bring forward money allocated for future spending on social housing to encourage developers to continue with projects.