Stamp duty exemption for first-time homeowners will be like "manna from heaven", Housing Minister David Burch predicted yesterday.

He told the Senate he was "very pleased and presently surprised" at the proposed financial relief for Bermudians buying properties valued at $750,000 and below. "I didn't know we were getting the gift of stamp duty exemption," he said. "That's like manna from heaven."

Sen. Burch said he expected the exemption to stimulate the housing market — but he counselled those looking for a new home to "wait a little while longer".

He said rents and house prices were dropping and would probably continue to do so. The Minister said it was one positive impact of the economic downturn. "To be perfectly frank, people have gouged people, both guest workers and Bermudians, on extortionate rents and extortionate costs for places and it's high time that they drop," he said.

Finance Minister Paula Cox delivered a statement to the House of Assembly last week on the new stamp duty regulations, which were promised in the 2009/10 Budget and will be tabled this week.

She told MPs: "These regulations amend the Stamp Duties Act 1976 and introduce an exemption from the payment of stamp duty on the conveyance of a property for a purchase price of $750,000 or less to a first-time homeowner. "The measure is intended to provide some relief to first-time homeowners and to stimulate sales of properties in that price range in these very difficult economic times."

The exemption, which the Deputy Premier said was aimed at promoting the economic welfare of Bermudians, will come into effect on April 1.

Ms Cox explained: "From that date there will be no stamp duty payable on the conveyance of the entire freehold or leasehold interest in a residential property consisting of a house, condominium or a parcel of land with a purchase price of $750,000 or less if that conveyance is executed by the parties on or after that date. Conveyances relating to fractional ownership units or condominium hotel units will not benefit from this exemption."

She said those eligible must be Bermudian and must never have held an interest in another residential property greater than 25 percent of its market value. They must be buying a property at fair market value, be paying in cash or by way of a mortgage to ensure the transaction is not a sham and must live there for at least three years.

Those buying parcels of land must declare that they will complete the construction of a residential unit within three years.

Parties will also have to declare that the sale is not a part of a larger transaction above the $750,000 threshold.

Ms Cox said: "The announced stamp duty exemption has raised a buzz amongst prospective first time homeowners seeking to secure their first piece of the rock. It has also excited realtors."