Shortly, George Osborne will be announcing the Budget for 2013. Landlords, tenants and agents alike will be taking a keen interest in the Chancellor’s plans to solve the problems of the housing crisis. On the eve of the announcement, a member of a large letting agency has called for the Chancellor to allow landlords to be given the chance to solve the problem, citing that their experience could prove vital.
New Buy scheme
Ajay Jagota of KIS Lettings made the call in the wake of revelations that the recently introduced NewBuy scheme is falling a long way short of its target. The scheme, designed to help 100,000 families into the property market has benefited just 1,500 families to date.
Mr Jogota believes that the Government should use the upcoming budget as a springboard to propose measures in order to assist landlords to fill some of the 710,000 empty homes within the U.K. He thinks that local authorities could be encouraged to sell uninhabited properties to investors for smaller fees. In addition, he believes that the Government should introduce grants or financial incentives in order to assist landlords to bring empty properties back up to living standards.
Letting agents encouraged to solve housing crisis
Mr Jogota describes the NewBuy scheme as, ‘perfectly noble,’ but, ‘clearly inadequate in solving Britain’s housing shortages.’ He goes on to say, ‘at the same time, landlords and letting agents are all too often being treated as part of that problem, when we could be part of the solution. Statistics show there are 50,000 homes standing empty in the North-East alone. With a little creative thinking and for a modest investment the government could rapidly bring hundreds of thousands of properties to the market with minimal effort, just by giving landlords the power to turn boarded up buildings into family homes.’
The cost of renovating a property can be astronomical for some landlords. Labour costs and unoccupied property insurance are just two features that, when mixed with the current economic conditions, can price landlords out of making changes to a property. Mr Jagota suggests that the Government should be doing more to assist landlords who find themselves in this situation. He says that Osborne should, ‘look at the successes of the so-called 50p homes in the East End of Newcastle-where once abandoned council properties are now much-loved homes valued of at least £150, 000.’
Jagota goes on to say that schemes such as this would give economies a welcome shot in the arm. He expresses that, ‘Not only would projects like this allow the government to regenerate rundown communities cheaply, as this money would mostly be spent on giving work to local tradespeople and buying materials from local businesses they would boost the economy too. At the end of the day, both the economy and the housing market will only really start to improve when the banks start lending again, and that must be the government’s priority. On the other hand, it doesn’t mean that it isn’t possible to have at least 50,000 North East homes ready to go within months with just a little imagination.’