With changes to the buy-to-let system, it is expected that there will be a shift in the UK’s housing market, with more investors looking to the north in order to limit the new stamp duty costs that the property market in the south is likely to incur.
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“Many buy-to-let investors underpin some of the bigger developments in particular”, Jeremy Leaf, former chairman of the Royal Institution of Chartered Surveyors, said in an e-mail.
“Frankly, people buying a home to let should not be squeezing out families who can’t afford a home to buy”, Osborne said. Therefore there will be an increase of 3% in stamp duty for non-main residence purchasers, which would also raise an additional £1bn in tax.
Money raised from tax on people buying their second home will be used to help those struggling to buy their first home.
“It is interesting that Osborne did not impose the extra tax straight away, as he did in last year’s autumn statement, but he has given potential buyers a few months’ grace”, he said.
Campbell Robb, chief executive of Shelter, said: “The Chancellor can’t ignore the fact that home-ownership schemes like Starter Homes or shared ownership won’t work for many, so building more genuinely affordable homes to rent is still absolutely essential”.
“The exemption for corporate investment makes this effectively an attack on the small private landlords who responded to the housing crisis by putting their own money into providing homes by the party that they put their faith in at the election”.
Frankish also welcomed London Help to Buy, which includes an increased 40% equity loan to reflect the higher cost of buying in the region.
Of these homes, almost half will be starter homes, which will be sold at a 20% discount to the market value to young first-time buyers.
The Government is attempting to woo first-time buyers with a promise of 400,000 affordable new homes – plus a special scheme just for London. He also noted shares in housebuilders had pulled back from the high seen pre-statement earlier in the day.
Depending on which paper you read, expect help for the railways, an affordable homes programme, changes to housing benefit and a possible U-turn on housing credit.
He gave the example of a one-bedroom flat in Camberwell, south London, which was on the market at £360,000.
Data from the Council of Mortgage Lenders on Wednesday showed first-time buyer loans in London rose 17% quarter-on-quarter 12,800 in the third quarter, although that marked a 1% decline on a year-on-year basis. “This could be done with an income of £50,000, which is much more achievable in the capital”, said Anderson.
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‘Shares in house building companies propelled the FTSE upward as the chancellor announced a doubling of the government housing budget, ‘ said Laith Khalaf, senior analyst at Hargreaves Lansdown.
