March Budget Review
In the weeks and months leading up to the March Budget, many people expected it to be a Budget which focused on housing matters. Housing was a key issue for the Conservative Party in the lead-up to the General Election. The convincing majority won in the General Election provided confidence in the housing market, and many industry observers spoke of a “Boris Bounce.”
Therefore, many felt the Budget would attempt to capitalise on this optimism. However, as we all know, the Budget primarily focused on attempts to deal with the Coronavirus. This led to housing taking a back seat, even if there were still a number of measures introduced.
Surcharge on non-UK property buyers may affect market
A key measure announced at the Budget was the 2% surcharge for non-UK residents buying property in this country. Mark Hayward is the Chief Executive of NAEA Propertymark, and he spoke about the stamp duty surcharge, saying; “If introduced, this policy allows those in the UK to have a better chance at purchasing a home. However, overseas buyers tend to purchase properties in prime central London which are completely unaffordable to most homebuyers anyway. Therefore, this move will not help those that need it most.”
It would be fair to say there has been mixed opinions about this measure. There are people who believe it is a bold step, and one which will assist first-time buyers step on to the property ladder. However, there has also been some criticism of the measure.
There are people who say this surcharge will only affect markets in London and the South East of England. There have also been complaints about how many properties will be sold this year. The measures don’t come into effect until April 2021. This creates an opportunity for foreign investors to buy UK property before the surcharge is effective. With the £ currently struggling in the market, there is added incentive for foreign property investors to buy sooner rather than later.
Is enough being done to support first-time buyers?
Some people have been unhappy at the lack of measures aimed at aiding homebuyers. Martijn van der Heijden is the chief strategy officer of online mortgage firm Habito, and he said; “At a time when current and aspiring homeowners are seeking confidence and reassurance, the absence of specific measures to support them onto the housing ladder or into their next home is disappointing.”
Martijn also said; “We know that access to the housing market remains a fundamental challenge for many, so the lack of structural measures to get a broken housing market moving will come as unwelcome news for households up and down the country.”
There has also been criticism from The Residential Landlords Association, (RLA) and National Landlords Association (NLA), who prepared a joint statement, which read;
“The Government is undermining its own efforts to boost homeownership through its attacks on the private rented sector. By choking-off supply and making renting more expensive it is tenants who are hardest hit. Ministers need to wake up to the reality of the damage their tax measures are doing to the private rented sector and support landlords to provide the new homes for private rent we desperately need.”
We know this is a challenging time, and for many households, the thought of buying or selling property is far from their mind. However, we also know many people are keen to keep themselves entertained, and some people may have property market issues. If we can be of any use to you, please contact Harpers Estates, and we will be more than happy to assist you.
