There is a school of thought that reckons the planning system for the housing market could be improved by taking more account of market information when making decisions regarding major developments.Planning at regional and local levels could be improved by making better use of information about prices and preferences as they affect the density of developments or the composition of social housing in residential development schemes. And greater certainty and speed would help, though not at the expense of making bad decisions. Also, it would be good to see the reform of property taxation high on Gordon Brown’s agenda to mitigate house price cycles. Any reform of Council Tax, following the review by Sir Michael Lyons, should consider the impact it could have on the housing market. With the pre-Budget report due on December 5 it will be a wonderful Christmas present for home owners if the government raises the Stamp Duty threshold at least in line with inflation, while promising to undertake a full review of property taxes such as Inheritance Tax and Council Tax. More creative possibilities for Stamp Duty include a temporary abolition for the new build market to generate more house building as well as stimulate demand for new build property by first-time buyers and house movers, and a one-off increase in the threshold for residential properties in London and the South East to recognise the price differential in these areas as compared with other parts for the country. Clarification on plans for the launch of self-invested personal pensions due next April would also be good so the property industry can plan ahead with the Financial Services Authority, which won’t be able to regulate this market until April 2007 at the earliest. On the surface, last year’s rise in the Stamp Duty threshold to 120,000 seemed a welcome step forward for the housing market, but given that the average price of a property in London is now 300,000, further alternatives must be considered to provide access to affordable housing for all. With more people settling in London than ever, key workers and first-time buyers looking to live in the capital are finding getting onto the housing ladder increasingly difficult. The government, via the Office of the Deputy Prime Minister, has recognised the need to tackle barriers to home ownership by publishing proposals to help with its HomeBuy scheme. This is an opportunity to provide dynamic solutions to affordability problems. But the government has done little so far to address the concerns of lenders involved in the most innovative part of the scheme – the proposed public private partnership. Furthermore, the HomeBuy scheme potentially exposes the government to high costs and possible volatility in the housing market, and the taxpayer may have to bear the cost of any losses. The good news is that HomeBuy has the potential to tackle some of the difficulties faced by currently excluded consumer segments. To make the scheme work the government should protect taxpayers and foster lenders’ participation by taking out third party insurance, effectively removing risk from the scheme. Ultimately, the scope of the scheme will depend on the government’s appetite for risk and its commitment to encouraging responsible lending. Further consultation and discussion with experts from relevant sectors of the financial system on structuring affordable housing programmes should be encouraged to ensure efficient use of taxpayer funds.
- Top trends
- Top trends
Houses built as affordable homes for nurses and teachers are standing empty despite lengthy waiting lists, the government has admitted. Yvette Cooper, housing minister, said in a written statement to the House of Commons that more than a third of the homes built as part of New Labour’s Key Worker Living scheme are standing empty […]
First-time buyers are returning to the mortgage market after a period of enforced exile caused by the deadlock of high property values and lack of accessible mortgage products.Paul Hearnden, managing director of My Mortgage Direct, says: Over the past three months we have seen a 15% increase in enquiries from first time buyers. The stability […]
Homebank Mortgages, the Northampton based national mortgage broker, has appointed Rupert Atkinson as chief executive officer. Homebank recently completed a major review of its strategy and working practice in the wake of the changes in the regulatory framework.Atkinson says: “I have worked for Homebank over the last five years and been part of its growth. […]
Yorkshire is offering Huddersfield Town fans a mortgage deal that comes with free season ticket and signed shirt. From Saturday, November 26, supporters who are either looking to move home or just move their mortgage can take home next years season ticket and a Terriers shirt, signed by their favourite player. The offer is open […]
Following a cabinet reshuffle in light of last week’s general election, David Cameron has announced that Ros Altmann will be replacing Steve Webb as pensions minister. As the industry works with one of the largest reforms to the sector in almost a century, the former adviser to Tony Blair has been tasked with ensuring that the pensions revolution does not stray off track.
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