Was thinking more in the context of families who are looking to trade up due to family expanding, wanting elderly relative to live with them etc.
There was one or more good debates about the disrupting effects of stamp duty on people trading up among other things but unfortunately I can't find them now. I think they may have been moved from Great Debates to Budget 2005 and the latter forum was archived off the public site after the budget had passed making the discussions inaccessible.
But also investors to a certain extent
Investors already get generous tax breaks (e.g. ability to offset 100% of mortgage interest and other allowable expenses against rental income) and I personally don't believe that they need any more.
ie would like to buy 1 property to provide for retirement. Many people would not like or trust equities meaning property is the only real option of achieving long term growth and future income.
There are other ways to invest directly or indirectly through a pension scheme in property. Pension style tax breaks should not be extended to those buying property with their retirement in mind when the property in question remains a liquid/disposable asset in my view (since they could pocket the tax breaks and then make a quick killing by selling up prematurely).
In any case there is no reason a priori why one asset class is better than another one. One could easily argue that those who own their own home and are buying investment property as some sort of pension are, by concentrating much of their wealth in a single asset class (and usually also a single geographic region), are undertaking more significant risk than somebody who owns their own home and then diversifies their pension and other savings over a wider range of asset classes and risk/reward profiles (e.g. shares, bonds, cash etc.).