Brilliantly brutal, mad and confusing #TwinPeaks is back and I have no idea what the hell just happened in those couple of hours - fab
25th November 2015
The Chancellor spoke for a little over an hour this afternoon, but the big property market show was saved for near the end and included more than a couple of eyebrow raisers!
Apart from the promises to double the Housing Budget to £2 billion per annum there was the already public plans to build 400,000 new affordable homes from a combination of previously announced policies.
Most will come from the Starter Homes initiative, which involves new homes being sold to first time buyers at a 20% discount, whilst 135,000 are earmarked from a new Help To Buy: Shared Ownership scheme. The Chancellor pledged to remove restrictions on “who can buy them, who can build them and who they can be sold on to”.
Help To Buy was also pushed in another guise directed at the Capital, with the cunningly named “London Help To Buy”. Here, those with a 5% deposit could qualify for a government loan of up to 40% of the value of a new build home! The loan will be interest free for 5 years and can be used in conjunction with the new Help To Buy ISA launching on December 1st.
So whilst the Help To Buy family is well and truly growing, the prospects for the Buy To Let market took an interesting turn in the biggest shock news of the day, (the tax credit U-turn was half expected).
For those purchasing a Buy To Let or second property from 1st April 2016, there will now be an ADDITIONAL 3% stamp duty charge; yes, that is 3% ABOVE the current SDLT rates.
We knew that the Chancellor had the Buy To let market in his cross-hairs and this latest action could be seen as an all-out declaration of war on landlords.
The devil will be in the detail to follow, but with landlords still reeling from recent changes to tax relief, there will be further concerns over the viability of this sector in the future. It looks like Corporate investors and institutions will be exempt from this, but this is all to be confirmed. Will we see even more call for loans in limited company names?
Whilst it is all very well to want to help first time buyers who are struggling to get on the housing ladder by removing a section of the competition, it is important to note that the private rental sector does play an important part in the housing market and the Government needs to tread carefully to ensure that a sudden flight of landlords does not cause as many issues as they hope to solve.
All in all an interesting time where Housing is concerned and there will be much discussion and dissection of the policies over the coming days. Whether you think this is all positive or negative will of course depend very much on whether you are a first time buyer or a landlord, but at least housing is finally getting the important political positioning it needs.
We continue to campaign for a stable housing market, with increased stock and a sustainable long-term plan to ensure that the owner-occupier, private rental and social housing sectors are vibrant, affordable and offer a real choice to those needing a home.
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Andrew Montlake, Director and Spokesperson for Coreco, gives his honest and forthright views on the mortgage market, economy and all things property related. Monty was voted "Mortgage Personality of the year 2008", "Best Press Spokesperson" in 2011 and is the current holder of the British Mortgage Awards “Best Marketeer” title. Expect expert analysis, delivered in a down to earth style with a side helping of exuberance.