Property purchasers paying for their new homes in stages are losing out on stamp duty relief because of recently-introduced Department of the Environment regulations.

The Department is refusing to issue floor area compliance certificates until the properties are completed and inspected. However, under stage payments, the title deeds of the site can be signed over much earlier in the process.

The signing over of title is the key point when it comes to applying for stamp duty relief according to the Law Society. Banks providing mortgage loans want people to secure title to their property as early as possible to provide security on the loans.

Revenue rules state that the title deeds must be dated after the floor area compliance certificate has been presented in order to qualify for the relief.

The problem dates back to the introduction of new regulations by the Department last September. They require that new homes qualifying for stamp duty relief not only occupy a floor area of less than 125 square metres but also that they comply with all building regulations.

In addition, they must use "durable" materials capable of lasting around 60 years.

The new regulations were introduced in September last year but are only now affecting buyers who may have signed contracts with builders last autumn.

They are a significant blow to purchaser of new homes who understood, under Government guidelines, that owner occupiers of all new homes under the 125 square-metre limit qualified for stamp duty relief.

Only last week, the Revenue was forced to step back from earlier clarification on the source of borrowing for first-time buyers which would have deprived thousands of them of access to stamp duty relief.

The latest confusion will mostly affect purchasers outside the capital - particularly in Cork, Limerick and Galway - where stage payments are common.

The Law Society is understood to have approached the Department of the Environment and the Department of Finance on the issue.

However, it is understood there is little sign of a change of policy.

The Construction Industry Federation is seeking a meeting with the Law Society to try to find a solution to the impasse. But solicitors argue any solution would leave them personally liable.