We hear from some of the leading experts within the property industry on the budget announcement…
5% mortgage deposit scheme
Marc von Grundherr, Director of lettings and estate agent Benham and Reeves, commented’:
“While Help to Buy in its various forms has helped homebuyers to an extent, it’s also done a good job of pushing house prices higher and homeownership even further out of reach for many.
To roll this sort of counterproductive initiative out to the whole of the market wouldn’t be so bad if the government also addressed the issue of supply. If you have trouble climbing the stairs you need to add a handrail, not increase the size of the staircase. However, the government has, yet again, chosen to do just this.”
CEO of Enness Global Mortgages, Islay Robinson commented:
“95% mortgage products in any shape or form take the market into pretty overheated, dangerous territory and we’ve previously seen the results of this kind of precarious lending to those who aren’t really in the financial position to commit to it.
As always, the devil will be in the detail but many lenders have already tightened their belts over the last few months in terms of their high loan to value offerings.
Although many big lenders have committed to the government’s announcement today, it will be interesting to see just how many buyers are able to secure such a product when it comes to actually applying.
Converting Generation Rent to Generation Buy is a noble initiative but not if it comes at the expense of wider market health.”
Stamp Duty Holiday Extension
CEO of Keller Williams UK, Ben Taylor, commented:
“Today’s stamp duty holiday extension will be very warmly welcomed by homebuyers waiting to complete and currently stuck in the transaction pipeline due to market delays.
The original stamp duty holiday is on track to save homebuyers an estimated £1.5bn and with the extension in place, this benefit should increase to £2bn with 360,000 transactions likely to benefit until the new June deadline.
However, the rabbit out of the hat of this Budget is the welcome news that the minimum threshold will increase to £250,000 until the end of September, bringing a further saving and a softer landing as the market returns to normality. This equates to a further saving of £2,500 for those completing once the main deadline has expired.
But with the holiday bringing such huge benefit to the market, surely it’s time for the government to re-evaluate the tax charged on home purchases on a permanent basis?”
Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented:
“Ironic, perhaps, that a delayed Budget should deliver a delayed stamp duty holiday deadline, which does little more than delaying the inevitable reality that awaits the market when the reprieve does finally end.
Those brave enough to tackle the huge market delays already being seen should do so now as there are very dark clouds building in June. While a staggered return to normality is likely to reduce the impact of the current cliff edge, it’s still likely to bring a shower of transaction fall throughs and house price decline down on the market.”
Founder and CEO of GetAgent.co.uk, Colby Short, commented:
“The Budget is fast becoming the government’s equivalent to Groundhog Day, full of headline-grabbing announcements to benefit homebuyers and fuel demand, with little to no intent on addressing the issue of supply.
It’s as if each time the Budget roles around, the Chancellor looks at the consistent failings of his predecessors and says to the Prime Minister, ‘hold my briefcase’, as he looks to go one better. Or worse, as the case may be.”
What was missing?
James Forrester, Managing Director of lettings and estate agent Barrows and Forrester, commented:
“Extremely disappointing to see the Government maintain their head in the sand stance on building more homes.
They usually talk a good game with regard to house building and we often hear dramatic cries of ‘build, build, build’ when the Budget rolls around. Unfortunately, the only thing that has been built is the suspense waiting for them to deliver on these promises.
This time around we didn’t even see the usual empty rhetoric and hot air, so we can assume that they will continue to ignore what is perhaps the biggest problem currently impacting the housing market.”
Co-Founder of UniHomes, Phil Greaves, commented:
“Great news to see that for once, the government has decided to ease the pressure placed on the throats of hard pressed landlords in recent years, with no increase in capital gains tax announcement and no further tax relief reductions.
Deterring landlords will only ever reduce the level of rental stock available to satisfy the huge number of people reliant on the sector in order to live. Let’s hope the government has now realised that without landlords providing the infrastructure that underpins much of our social housing they will end up with a rental crisis of their own making.“