Chancellor Rishi Sunak has announced a package of support to address the rising cost of energy bills, including a £400 energy grant per household in October.
Almost all of the eight million most vulnerable households across the UK will receive support of at least £1,200 this year, including a new one-off £650 cost of living payment
Universal support increases to £400, as the October discount on energy bills is doubled and the requirement to repay it over five years is scrapped
This new £15 billion support package is targeted towards millions of low-income households and brings the total cost of living support to £37 billion this year
New temporary Energy Profits Levy on oil and gas firms will raise around £5 billion over the next year to help with cost of living, with a new investment allowance to encourage firms to invest in oil and gas extraction in the UK
Responding to the announcement, Alicia Kennedy, Director of Generation Rent, comments: “This package is much closer to what people will need to manage rising prices, but one in three tenants have had rent rises this year, so many renters will still face agonising choices between eating, heating and paying rent.
“Tragically, because evictions without reason are still legal, renters have little choice but to cope with a rent hike.
“Two issues need urgent attention.
“For renters living in homes where energy bills are included in the rent, such as shared houses, it is not clear if the landlord is under any obligation to pass this new support to them through a reduced rent. The government needs to clarify how it will ensure renters receive the package of support as the Chancellor intended.
“While benefits will rise in line with September’s inflation rate, Local Housing Allowance is still frozen at 2019-20 levels.
“We need a freeze on rents, an emergency pause on evictions and increase LHA to cover market rents.”
Matt Downie, Chief Executive of Crisis, comments: “Following today’s (26th May) announcement by the Chancellor households across England will be breathing a collective sigh of relief.
“We know from our frontline services just how desperate things had become, with people unable to keep up with rising rents and spiralling energy and food costs. This targeted support for those on the lowest incomes couldn’t have been more needed and, alongside the commitment to increase benefits in line with inflation next year, will help people to keep a roof over their heads as we weather this cost of living crisis.
“While the Chancellor outlined that today’s intervention was ‘timely, temporary and targeted’, there is also a pressing need for the Government to think long-term. We need a clear plan to deliver the genuinely affordable homes that are so desperately needed so that people are protected from any sudden economic shocks in the future.
“Never again should people be forced to endure the hardship and pain of recent months before Government takes action.”
Marc von Grundherr, Director of Benham and Reeves, comments: “While the monthly cost of a mortgage looks set to keep on climbing, a good number of UK households can breathe a sigh of relief as Rishi Sunak pledges further money to help alleviate the cost of living crisis.
Over £15bn announced to help mitigate increased energy costs for those on benefits, pensioners and the disabled, will go someway in helping the most financially vulnerable in society and the refreshed reduction in council tax will also help ease monthly living costs, with a £400 reprieve that is no longer required to be repaid.”
James Forrester, Managing Director of Birmingham estate agent Barrows and Forrester, comments: “A step in the right direction but far too little, too late, for many of the worst hit UK households.
“Quite frankly today’s (26th May) announcements feel like forced rhetoric from a government on the back foot and as we know all too well, the results rarely match the headlining fuelling hot air.”
What about reducing the cost of energy at the pump to make an immediate, meaningful impact?”
This year’s Spring Statement from Chancellor Rishi Sunak has received responses from professionals within the property industry.
Ben Beadle, Chief Executive of the National Residential Landlords Association (NRLA) comments: “We welcome the decision to scrap VAT on energy efficiency measures. However, it remains disappointing that the Government has again failed to explain what will be required of the rental sector when it comes to energy improvements. The sector needs clarity as a matter of urgency.
“More broadly, as renters, along with all others, face a cost-of-living crisis, the Chancellor should have reversed his decision to freeze housing benefit rates. Without this, those relying on the benefit will find it increasingly difficult to afford their rents.”
Matt Downie, Crisis Chief Executive, comments: “What’s clear from this statement is that people up and down the country will be pushed into homelessness. It will not give support to families facing the cost-of-living crisis.
“Achieving this relies on keeping people in their homes and yet this budget provided little relief for desperate people trying to keep a roof over their head as inflation runs rampant and energy bills skyrocket. The UK Government must urgently invest in housing benefit so that low-income families can cover the cost of their rent and increase benefits in line with inflation, so people have a fighting chance to put food on the table.”
Alicia Kennedy, Director of Generation Rent, comments: “We are in a dangerous moment with millions about to be plunged into fuel poverty and people already in poverty facing desperate choices between heating and eating. When inflation is running at 7.4%, the Chancellor should have targeted help towards those least able to manage, by raising benefits at the same rate and making sure Local Housing Allowance covers rising rents. The higher National Insurance threshold will help many private renters but not our most vulnerable neighbours.
“Taking the National Insurance and income tax changes together, the Chancellor is stacking the economy against private renters who have to work for a living. While the Health and Social Care Levy will cancel out the planned income tax cut for workers, landlords will be better off because they don’t pay National Insurance on rental income. If he wants economic growth, the Chancellor should be shifting taxation from work to property wealth, and encouraging investment in more productive parts of the economy.
“The VAT cut on energy efficiency measures is welcome but until the Government acts on its promises to raise minimum energy efficiency standards for landlords and improve security of tenure, renters won’t feel the benefit.”
Paresh Raja, CEO of Market Financial Solutions, comments: “The Spring Statement was never likely to contain any major surprises as far as the property sector was concerned; at least not directly. But action was needed and, positively, it was taken to ease pressure on people’s finances in the short-term. In turn, this will help ensure the property market faces no nasty shockwaves.
“Rising inflation and interest rates are affecting both homeowners and homebuyers, impeding the amount they can borrow and save. So, it was positive to see the Chancellor cut fuel duty and financial support to households across the UK. The tax breaks for those making green improvements to their homes is also a welcome decision, encouraging the right type of property renovation.
“Looking to the property market, with demand still outweighing supply so significantly, it is likely that house prices will continue to rise as they have been. But for lenders, now is the time to act. We cannot leave it to the Chancellor alone to offer support to those hoping to get on or move up the property ladder. Rather, lenders’ focus must be on supporting their existing and prospective clients as best they can.
“Flexibility will be key; being too rigid in how and when you lend risks alienating certain buyers in the current climate, so lenders ought to consider how they can best meet each borrower’s particular needs and provide support to help them navigate the economic challenges they are facing.”
Marc von Grundherr, Director of Benham and Reeves, comments: “The biggest personal tax cut in the last 25 years and an early election Budget for sure. With such headline grabbing announcements, the lack of property focus will easily slip through the cracks.
“That said, environmentally minded homeowners will welcome today’s announcement that VAT on green additions to their home will now be cut from the existing 5%. Of course, with inflation also being announced at 6% today, has this benefit already been negated?
“While great for the planet, solar and hydro energy outlets can be expensive to implement and take some time before the return starts to outweigh this initial cost and so it remains to be seen how meaningful this move will actually be.”
Michael Bruce, CEO and Founder of Boomin, comments: “A Budget with nothing much for housing but a little for the household itself and this was largely to be expected.
“The Stamp Duty holiday introduced during the pandemic was probably the biggest bone the Government has thrown home buyers in recent times, so to expect another to come so soon after the final December deadline is certainly wishful thinking.
“Especially when house prices remain so buoyant as, after all, a high rate of house price growth is the Government’s driving indicator of success and they’ll only stoke the fires when these flames are starting to fade.”
James Forrester, Managing Director of Barrows and Forrester, comments: “Such a bold move on income tax is of course welcome, but let’s not forget that this is somewhat diminished by an increase in both personal and employer national insurance, as well as the impending hike in corporation tax.
“This will cause further problems for homeowners across the nation who will have seen a sharp increase in the cost of running their home already this year, with both an increase in interest rates, rising energy costs and a jump in fuel prices all bringing additional financial strain.
“So, while there’s been no real property initiatives announced today other than 0% VAT on energy saving initiatives, other announcements such as the cut in fuel duty and the increase to the household support fund will, at least, help reduce this overall cost of living.
“This should provide some small amount of breathing room for those that are particularly hard pressed at present, although it’s unlikely to solve the issue completely.”
Geoff Garrett, Director of Henry Dannell, comments: “Although there was generally no expectation that the property sector would feature in today’s Budget, some may have been hopeful of a breadcrumb or two from Mr Sunak in order to keep the market moving forward against what could be described as gathering financial headwinds.
“We’ve now seen a string of consecutive increases to the base rate and this is not only going to impact the monthly payments of those homeowners on variable rate mortgages, but it’s also going to reduce the bullish approach to borrowing that we’ve seen from homebuyers in recent years.
“The impact is likely to be a slowing in the rate of house price growth as buyers commit to lower borrowing amounts and sellers are forced to adjust their valuation expectations.”
In yesterday’s Autumn Budget announcement, Chancellor Rishi Sunak announced that the Universal Credit taper will be cut from 63% to 55% from 1st December 2021.
Ben Beadle, Chief Executive of the National Residential Landlords Association (NRLA), comments: “(Yesterday’s) announcement is welcome news for those private tenants who have struggled to afford their rents throughout the pandemic, despite private rents falling in real terms.
“However, it does not undo the damage that previous decisions to freeze housing benefit rates in cash terms will cause. It is simply bizarre to have a system in which support for housing costs will no longer track market rents. The Chancellor needs to undo this unjust policy as matter of urgency.”
Another key announcement welcomed by the NRLA is that the deadline for residents to report and pay Capital Gains Tax after selling UK residential property has increased from 30 days after the completion date to 60 days as of 27th October 2021.
Nicky Stevenson, Managing Director at national estate agent group Fine & Country, also comments on this news: “Millions of homeowners across the country will be pleased to hear that the Chancellor has resisted calls to increase Capital Gains Tax.
“Though CGT has long been an emotive issue for some, there is no amount of amending that would have assisted in making up for gaps in public finances created by the pandemic.
“HMRC has already seen CGT receipts jump 62% in the last five years. Increasing taxes further at a time when the economy is still recovering from the worst shock on record would not have been a wise move by the Chancellor in the Autumn Budget.”
The NRLA also welcomes the Government’s pledge to bring forward exemptions to the Shared Accommodation Rate for victims of domestic abuse and victims of modern slavery from October 2023 to October 2022. The Shared Accommodation Rate limits housing benefit support for single people under 35 to a room in a shared house. Those vulnerable will be able to claim the higher 1-bedroom self-contained Local Housing Allowance rate.
Chancellor Rishi Sunak has announced the Winter Economy Plan, which includes plans for a new Job Support Scheme and an extension of the Self Employment Income Support Scheme.
The report on the Government website also highlights that ‘over one million businesses will get flexibilities to help pay back loans.’
The package of measures, which applies to all of the UK, includes:
Support for workers
Tax cuts and deferrals
Giving businesses the flexibility to pay back loans
The Chancellor of the Exchequer Rishi Sunak said: “The resurgence of the virus, and the measures we need to take in response, pose a threat to our fragile economic recovery…
“Our approach to the next phase of support must be different to that which came before.
“The primary goal of our economic policy remains unchanged – to support people’s jobs – but the way we achieve that must evolve.”
Responding to the Chancellor’s Winter Economy Plan, Chris Norris, Policy Director for the National Residential Landlords Association (NRLA), has commented: “We welcome the Government’s measures to subsidise wages.
“We warned that the end of the furlough scheme ran the risk of many households facing further difficulties in paying their rents. Today’s announcement is an important first step to prevent this.
“That said our research still shows that private landlords across England have faced rental loses of up to £437 million as a result of COVID-19.
“It is vital that the Government now follows the example set in Wales and Scotland and develops interest free, government guaranteed hardship loans to help tenants pay off rent arrears built as a result of the pandemic.
“We cannot expect them, or landlords, the vast majority of whom are individuals without the means to absorb significant losses, to continue to struggle without support.”
With Chancellor Rishi Sunak announcing plans for a stamp duty holiday, lettings and estate agent Benham and Reeves has researched the best areas to invest in London.
The research looks at the current average house process and rental yields of London postcodes. The results show that current rental yields sit at an average of 3.7% across the capital.
The postcode of SE17 appears to provide one of the best investment opportunities, with an average house price of £560,120 and an average rental yield of 4.1%. The stamp duty holiday will mean that buyers can save a maximum of £15,000 in this area.
SE17 covers parts of Lewisham, Southwark and Lambeth.
Other key areas to consider include SE11 in Kennington and SE15 in Peckham.
Director of Benham and Reeves, Marc von Grundherr, commented: “For far too long the government has squeezed the life out of the buy-to-let sector, and so it’s great to see that, finally, there has been some financial breathing room afforded to landlords.
“As the backbone of the UK rental space, landlords are a vital cog in the machine that so many rely on to put a roof over their heads.
“This momentary reprieve where the cost of stamp duty is concerned means that now is a great time to invest for those considering it, those looking to expand their portfolio, and for those that have exited the sector in recent years.
“Not only is there a considerable saving of thousands of pounds in stamp duty on even the most affordable investments, but we’re seeing above-average rental yields the length and breadth of the capital.”
London postcodes with above-average rental yields sorted by the second home stamp duty tax saving
Postcode districts
Average price
Current SDLY
Previous SDLT
SDLT Saving
Rental yield
SE17
£560,120
£19,810
£34,810
£15,000
4.1%
SE11
£568,751
£20,500
£35,500
£15,000
4.0%
SE15
£522,849
£16,828
£31,828
£15,000
4.0%
IG7
£519,560
£16,565
£31,565
£15,000
3.9%
SW9
£526,690
£17,135
£32,135
£15,000
3.9%
SE16
£527,245
£17,180
£32,180
£15,000
3.8%
E9
£526,139
£17,091
£32,091
£15,000
3.8%
SW2
£515,004
£16,200
£31,200
£15,000
3.8%
N7
£560,678
£19,854
£34,854
£15,000
3.8%
IG5
£530,809
£17,465
£32,465
£15,000
3.7%
SE5
£498,293
£14,949
£29,863
£14,915
4.2%
TW8
£488,008
£14,640
£29,041
£14,400
4.1%
E16
£478,140
£14,344
£28,251
£13,907
3.9%
SE8
£468,404
£14,052
£27,472
£13,420
4.0%
E7
£466,197
£13,986
£27,296
£13,310
3.7%
CR5
£461,895
£13,857
£26,952
£13,095
3.7%
E3
£454,032
£13,621
£26,323
£12,702
4.1%
NW9
£434,162
£13,025
£24,733
£11,708
4.0%
RM12
£428,160
£12,845
£24,253
£11,408
3.8%
DA16
£424,285
£12,729
£23,943
£11,214
3.8%
SE14
£423,951
£12,719
£23,916
£11,198
4.0%
N17
£422,617
£12,679
£23,809
£11,131
3.9%
IG2
£421,367
£12,641
£23,709
£11,068
3.8%
E15
£419,352
£12,581
£23,548
£10,968
4.5%
SE18
£415,234
£12,457
£23,219
£10,762
4.0%
HA1
£402,216
£12,066
£22,177
£10,111
3.9%
SE19
£399,937
£11,998
£21,995
£9,997
3.9%
SE13
£396,240
£11,887
£21,699
£9,812
4.0%
UB1
£395,443
£11,863
£21,635
£9,772
4.1%
UB8
£393,758
£11,813
£21,501
£9,688
3.9%
E6
£390,117
£11,704
£21,209
£9,506
4.4%
E12
£389,800
£11,694
£21,184
£9,490
4.4%
UB4
£389,512
£11,685
£21,161
£9,476
3.9%
UB2
£379,871
£11,396
£20,390
£8,994
4.0%
IG1
£377,060
£11,312
£20,165
£8,853
4.0%
TW4
£376,553
£11,297
£20,124
£8,828
3.9%
N18
£376,507
£11,295
£20,121
£8,825
3.9%
RM13
£370,560
£11,117
£19,645
£8,528
4.5%
SE20
£368,119
£11,044
£19,450
£8,406
3.9%
N9
£365,764
£10,973
£19,261
£8,288
4.0%
RM7
£362,158
£10,865
£18,973
£8,108
4.2%
E13
£361,283
£10,838
£18,903
£8,064
4.5%
SM6
£360,418
£10,813
£18,833
£8,021
4.0%
UB3
£359,372
£10,781
£18,750
£7,969
4.2%
UB7
£357,537
£10,726
£18,603
£7,877
4.3%
RM6
£355,199
£10,656
£18,416
£7,760
4.3%
TW13
£350,305
£10,509
£18,024
£7,515
4.0%
EN8
£349,893
£10,497
£17,991
£7,495
3.8%
SM2
£349,380
£10,481
£17,950
£7,469
3.9%
RM3
£347,880
£10,436
£17,830
£7,394
4.6%
TW14
£347,231
£10,417
£17,778
£7,362
4.1%
EN3
£347,078
£10,412
£17,766
£7,354
4.3%
CR0
£345,101
£10,353
£17,608
£7,255
4.0%
UB5
£341,658
£10,250
£17,333
£7,083
4.3%
DA14
£334,090
£10,023
£16,727
£6,705
4.4%
SE2
£333,535
£10,006
£16,683
£6,677
4.3%
SE25
£331,157
£9,935
£16,493
£6,558
4.1%
RM8
£326,145
£9,784
£16,092
£6,307
4.9%
RM9
£323,390
£9,702
£15,871
£6,170
5.1%
RM10
£319,782
£9,593
£15,583
£5,989
5.2%
DA8
£300,492
£9,015
£14,039
£5,025
4.6%
IG11
£296,415
£8,892
£13,713
£4,821
5.5%
DA1
£290,581
£8,717
£13,246
£4,529
4.5%
SE28
£275,498
£8,265
£12,040
£3,775
5.0%
London Average
£485,794
£14,574
£28,864
£14,290
3.70%
House price and rental data sourced from PropertyData
Chancellor Rishi Sunak has announced plans for a Stamp Duty holiday in the 2020 summer statement. This will make most homebuyers exempt from paying any Stamp Duty as part of plans to kick-start Britain’s economic recovery.
The following industry responses have been released:
Mary-Anne Bowring, group managing director at Ringley and creator of automated lettings platform PlanetRent,says: “The Chancellor’s proposals to exempt most homebuyers from paying any Stamp Duty under plans to kick-start Britain’s economic recovery is welcome news.
“A Stamp Duty holiday would no doubt cause a rush of transactions and help breathe life into a housing market that has been put into deep freeze in an effort to battle coronavirus.
“The government should be looking at long-term solutions as well as short-term sticking plasters when it comes to fixing the UK housing market.
“Millions of Brits were already renting, and that number was predicted to grow anyway with or without coronavirus. The disruption caused by coronavirus will likely see rental demand grow, as banks squeeze potential buyers with tighter lending restrictions and people put off buying or selling a home as it becomes clearer COVID-19 has caused continued uncertainty and disruption in the medium term.
“Eliminating additional Stamp Duty for buy-to-let investors would help stimulate the supply of rental homes while also driving wider activity in the housing market. Landlords are a crucial source of development finance through off-plan sales and will help support getting Britain building again.”
Mark Arnold, CEO, Kensington Mortgages, comments: “If the housing market is working properly, that has a massive impact on the rest of the economy – so this potentially is a big boost. A Stamp Duty holiday is a huge market change and this has never happened before.
“First-time buyers, second steppers and older homeowners will all benefit. Even before lockdown, there was a clear stagnation in housing activity on those higher up the property ladder.
“Extending the threshold to £500k frees up larger properties for growing families and enables the next generation of homebuyers to step onto or even up the ladder. Buyers will make a significant tax saving and this acts as a large incentive to keep all parts of the housing cycle moving in some of the most crucial summer months.”
Mark Hayward, Chief Executive of NAEA Propertymark, comments: “Following our engagement with HMT and MHCLG over the past few months, we welcome the Chancellor’s announcement this afternoon that he will be raising the threshold at which buyers will pay Stamp Duty to £500,000.
“This a is a welcome commitment by the government and we are glad that they have listened to our calls to help sustain the property market following lockdown. These measures will enable people looking to buy a home to have the confidence and stability to be able to move forward with their purchase, which in turn will have a knock-on effect on the wider economy as people buy white goods and furniture.
“The market is moving well at the moment, however once furlough has ceased and the anticipated recession hits, the market might well need further financial impetus, therefore it is right that the sector is given the support and tools it needs to rebound over the next 9 months.”
Marc von Grundherr, Director for Benham and Reeves, comments: “84% of transactions made in the last six months would have seen the amount owed in Stamp Duty eradicated as a result of today’s announcement, so there’s no denying that this should bring about a monumental boost for homebuyers going forward.
“However, some may also argue that it’s not before time. Stamp Duty is simply an additional financial barrier when buying and one that does little more than filling the government’s pockets.
“While the market has weathered the storm of pandemic price decline so far, this latest move should help keep property values buoyant. Although, it is disappointing to see yet another government initiative that focusses on fuelling demand instead of addressing housing supply.”
James Forrester, Managing Director of Barrows and Forrester, says: “A bold move by the chancellor today and one that will no doubt stoke the fires of homebuyer demand with such a large proportion of those transacting due to benefit.
This shot in the arm should ensure top-line demand and price growth remain immune to any unseasonal downward trends and implementing this initiative from the get-go avoids any short-term decline in transactions.
The only criticism is, perhaps, that the government has once again focussed on fuelling demand rather than addressing the more pressing issue of housing supply. While this will help boost house prices, it will do little to address the supply and demand imbalance and the problem of affordability that many are already facing.”
Islay Robinson, group CEO of Enness Global Mortgages, says: “The government has mostly ignored the top end of the market in recent years and this has had a detrimental impact on demand and property values in the prime London market, in particular.
“Today has been much of the same and although high-end homebuyers will enjoy some form of discount where Stamp Duty is concerned, it’s looking unlikely that this will apply to second homes and they certainly won’t be getting any richer thanks to Rishi.
“In fact, this archaic tax continues to leave a bad taste in the mouth of prime buyers who are paying huge sums in addition to the value of their chosen property, and it’s about time this government money grab is abolished altogether.”
Stamp Duty holiday plans announced by Chancellor Rishi Sunak
Phil Bailey, Sales Director for mortgage tech provider Twenty7Tec, says: “We hope that the housing market will get the stimulus it needs from the Chancellor’s announcement on Stamp Duty. For us to have a housing-led recovery, we need first time buyers in the market and this measure will go some way to helping alleviate the level of funding that they need to get onto the property ladder.
“However, it’s not a perfect solution. There’s a lack of mortgage products in the market in the 90%+ LTV range as lenders have adjusted for their risks and their own lending capacity. This means that deposit levels have, effectively, gone from 5% to 15%.
“Previously, this gap has been filled by the bank of mum and dad, but the last few months have eaten away at their savings and possibly their attitude to taking on new investments. There’s also less housing stock on the market, which means it’s a seller’s market.
“Unfortunately, this Stamp Duty holiday won’t really help with any of these points. In our view, it’ll drive a surge in demand, but it’s more than likely going to support people to buy bigger than helping those who are struggling to get onto the property ladder. The additional demand caused by this could push house prices up or see them stay the same and not drop as expected later this year.
“Speaking to lenders and intermediaries this week, there were two real worries in the market about this Stamp Duty announcement. First, that it has previously been mooted and not happened so people were questioning if it would happen this time. Second that it might be delayed until later in the year, which would induce an unnecessary halt in a housing-led recovery.
‘Thankfully, the current Chancellor is someone who seems capable of getting things done and at pace. We’ll see what the data says about a continued recovery over the next few days and weeks.”
Elisabeth Kohlbach, CEO of Skwire, comments: “Chancellor Rishi Sunak’s Stamp Duty change is a welcome shot in the arm for an under pressure property market and much-needed relief for buyers. But it does not go far enough.
“The relief will overwhelmingly help buyers in London and the South East, where property prices are highest, in terms of the savings they will make on a property, with many housing transactions in the regions already below the Stamp Duty threshold. So he needs to think again if he wants to help the Prime Minister’s Red Wall regions too.
“While it is right that the initiative is set to overwhelmingly help struggling first-time buyers, the withdrawal of low-value deposits by lenders and the drought of suitable mortgage offers needs to be addressed too if this initiative is going to help revive the housing market.
“He should also consider at least a temporary cut in Stamp Duty on higher-value properties. This market segment has been sluggish since Stamp Duty was raised, and the chain of transactions more expensive sales generate, as well as the advisory, agent, legal and other fees they produce, could help provide a short-an economic boost when it is most needed.
“The Chancellor’s move also only affects property buyers, and given that the PRS sector is a growing part of the UK’s housing mix and redundancies are on the rise, he should carefully monitor what impact the lifting of the Government’s eviction ban in August will have on tenants and be prepared to act if needed.
“If Sunak wants the housing market back on his feet, he should look at the sector as a whole and push through measures that benefit both buyers and renters alike.
Matthew McDwyer, founder of Bricks&Logic, says: “At Bricks&Logic, we’ve been continuously analysing London house prices since the easing of lockdown measures allowed viewings to start again.
“In the first month, asking prices have remained stable across the capital and agents report brisk business. We know that historically, Government policy is the single biggest driving factor for house prices and the last significant Stamp Duty change was followed by substantial changes in London house prices, particularly at the cheaper end of the market.
“Confirmation of the rumoured Stamp Duty holiday is likely to provide a shot in the arm for the property market. However, while this will possibly stimulate movement at the lower end of the market it is unlikely to have too significant impact on the wider London market but will boost movement outside the capital.”
Jeremy Raj, head of Residential Property at Irwin Mitchell, comments: “The Chancellor prefaced his announcement by explaining how key the residential property market and the housebuilding sector are in relation to the confidence and strength of the economy overall. There is no doubt that the recent uncertainties and practical difficulties created by lockdown have had a massively detrimental effect.
“The changes announced to SDLT today went further than most within the industry had dared hope. With an immediate increase in the tax-free band to £500,000 for a fixed period until 31 March 2021, there will be a real boost to the sector.
“There will also be widespread relief that the implementation has not been delayed until the autumn, which would potentially have stalled the market entirely.
“It is important to note that while the effect on the London market will be minimal, the vast majority of conveyancing transactions throughout the country will see a significant and immediate bonus effect, that should encourage greater activity.
“We can however expect a number of interesting discussions regarding how this windfall is to be shared between buyers and sellers. Clearly, anybody that completed their transaction within the last month or two will be rightly upset to have missed out. It also remains to be seen whether the market reacts by adjusting prices overall, or leaves the windfall with buyers.
“Overall, however, this is a hugely welcome announcement for housebuilders, the residential property industry, homeowners, and potential homeowners.”
Franz Doerr, CEO of flatfair, says: “The government’s Stamp Duty holiday is welcome news for the housing market overall, but there needs to be more clarity on what this will mean for buy-to-let landlords.
“Thousands of landlords have already left the sector in recent years, and support to help increase the number of homes available for rent will be sorely needed with the numbers of renters expected to increase as incomes plummet and mortgages become harder to get thanks to the economic impact of Covid-19.
“The government needs to realise that homeownership at all costs is no longer sustainable, and should have announced more to support both renters and landlords.”
