Ahead of today’s Summer Budget announcement, property expert Ben Thompson, managing director of estateagent4me.co.uk, is calling for a shift in policies to the other end of the property market, last-time buyers.
Helping older homeowners to downsize through a change in stamp duty tax would boost supply, Thompson says.
“The need to focus on last-time, rather than first-time buyers bucks a trend that has seen various Government initiatives to help those taking their first steps on the property ladder. A break in stamp duty for last-time buyers could prove unpopular with some who believe that boomers and older homeowners have benefited enough from the UK’s housing boom – but it is a move that would result in a more fluid marketplace.
Many of the baby-boom generation own homes that are no longer suitable for their needs. The decision to switch from larger houses to either a 2-bed or a bungalow is a popular one, however we’re not building enough of these dwellings to enable the older generation to move home. If last-time buyers can get comfortable with downsizing, the potential to free up homes that can then be occupied by those further down the property ladder would be vital in terms of unlocking under-occupied housing stock for young families and second steppers.
If the Government is brave enough to take this action, it will inevitably face a public backlash as it’s seen to be helping a generation who have already had their bite at the cherry. Nonetheless, last-time buyers represent a vital piece of the jigsaw and the Government is right to take this bold step to incentivise them to rightsize,” Thompson comments.
Housing promises
What the Conservatives have pledged in their manifesto has little to do with last-time buyers. Most policies are focused on helping more people get on the property ladder. However, many experts argue that while heavy on measures to bolster demand the manifesto is void of policies that would help increase supply. Since insufficient housing stock is the root cause of the property market crisis, future plans should focus on that.
Targets of manifesto housing pledges:
* Provide 200,000 starter homes by 2020 at a 20 per cent subsidy for those under the age of 40 – First-time buyers
* Build 275,000 affordable homes built by 2020 – Housebuilding/ First-time buyers
* Continue with Help to Buy – First-time buyers
* Introduce Help to Buy ISAs – First-time buyers
* Expand Right to Buy – First-time buyers
* A £1 billion brownfield regeneration fund – Housebuilding
* Create a London Land Commission to identify publicly owned land for development – Housebuilding
