Q. What’s your view of the Government’s new housing strategy?
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A. Of course, as an estate agent I am naturally in favour of anything that helps breathe new life into the housing market – which is what the Government says it is determined to do with this raft of measures. Indeed, David Cameron and Nick Clegg claimed that their new strategy would “unlock the housing market, get Britain building again, and give many more people the satisfaction and security that comes from stepping over their own threshold.”
All well and good – except for the fact that stripped of all the political hype, these measures will probably only achieve relatively little. Why? Firstly, because it is all rather small in scale – the £400million the strategy is designed to inject into the housing market will only help a relatively small number of people. Secondly, like the First Buy scheme announced with such fanfare back in the early summer, the focus of the new strategy is almost entirely on helping first time buyers purchase new-build starter homes - and encouraging developers to build more such properties by indemnifying them against at least some of the potential risks involved. No wonder that the big housebuilders – who are responsible for the majority of starter homes – are so keen on the idea!
But does all this matter, if the scheme succeeds in reigniting the housing market as a whole? If that were true, then I would be the first to give it an unqualified welcome. Sadly, however, that isn’t the case. Limited as they are to the purchasing of brand new homes by brand new buyers, the transactions that the strategy is designed to encourage will do nothing whatsoever to boost wider market activity by helping the vast majority of home movers. To do that, you need measures to stimulate the re-sale market as well.
So, if the Government really wants to kick-start the market, they could do a lot worse than instituting a stamp duty holiday on all property sales - new or second-hand, and irrespective of whether or not the purchaser is a first-time buyer – up to the £250,000 threshold.
Will the powers that be take such a bold step? You have to admit it’s unlikely – particularly at a time when they are rather more than usually strapped for cash. Still, there’s always hope!