Was it a missed opportunity to ignore Stamp Duty reform?
In the wake of the Chancellor’s Spring Budget on March 8, most media reports have focused on a so-called tax raid on the self-employed, but many experts in the property industry were more concerned by what was left out, rather than what was left in. Time will tell whether this has a detrimental effect on the housing market across the UK.
A number of industry insiders were hoping to see the beginnings at least of a reform on Stamp Duty, but in the end nothing of this nature materialised. A reform would have given the market a huge boost, but if there is to be any significant change it will now have to wait until at least November, when the Autumn Statement is made.
Stamp Duty generates a great deal of income for the government, and any reform will no doubt have been resisted strongly by certain ministers. The problem for the general population, however, is that this form of indirect taxation makes it increasingly difficult for first-time buyers to gain a foothold on what is already a difficult ladder to climb.
A busy market, but could it be busier?
Given the fact that the highest property values are often to be found in London and the South-East, it’s easy to see how such decisions can affect the market in an already congested region. Finding a home is difficult enough here, but it becomes almost impossible for some without a little help from the government.
While some industry experts expected nothing more than stubborn intransigence, there were some who at least hoped for a reduction in Stamp Duty levels for second home buy to let properties. This would have been seen as a positive step for all, and the knock-on effect would have been welcomed by renters on reduced incomes.
All is not doom and gloom, however, because the housing market itself is performing well. Here at James Neave, we continue to see a regular throughput of properties of all shapes and sizes. Like all estate agencies, however, we find the number of first-time buyers remaining fairly static. An opportunity may have been missed by the Chancellor in this regard.
For any government in any era, it’s almost impossible to make everyone happy via an annual Budget, of course. The omission of Stamp Duty reform this time around won’t have helped the property market, but some industry experts will no doubt continue to press for reform before the Autumn Statement. This is something of a hot potato in political terms, and it’s likely to be an issue that doesn’t go away.