At first glance this year’s budget seems like fantastic news for first time buyers. Stamp Duty will be scrapped for property up to £300,000 in the UK and up to £500,000 in London – for first time buyers this will certainly be welcome news! To many this will seem like a solid step in the government helping first time buyers, with an estimated 80% of buyers expected to benefit saving an average of £1,660.
However, does this go far enough? Does this really help first time buyers get on the property ladder, or is it purely a ploy from the Chancellor to sweeten us up and keep us quiet about the unattainable property market.
Resident Property Guru at Urbane Brix, Adam Ross believes the Budget hasn’t gone far enough in supporting the Property market. “Although the abolishment of Stamp Duty is no doubt great news for first time buyers, there are wider issues that the budget hasn’t addressed. Yes, buyers may save on average £1,660, but with property prices rising year on year, buyers will have to contend with bigger deposits and property costs, making the scrapped Stamp Duty almost an irrelevant cost. The government may have had hopes to provide a fresh boost to the housing market, but for first time buyers this still doesn’t address the lack of affordability”
From September 2016 to September 2017 the average property price rose by 5.4% to £226,367 (Gov.uk). For a first time buyer that’s a pretty hefty 10% deposit of £22,637. That’s the first hurdle first time buyers need to overcome - figuring out how on earth to get that amount of money together without having to beg, borrow or steal! More needs to be done to get people over that barrier. Without that, buyers will still remain in a difficult spot. First time buyers in London will certainly not see too many benefits as average house prices in the capital are already nearing to the £500,000 mark, standing at £481,556 (House Price Index).
Although this change is a step in the right direction, affordability is the real issue here. If the government can help overcome that, the housing market would definitely get the boost it needs. With a pledge of 300,000 new homes a year, let’s hope that affordability and speed is on the agenda.Back to Guru articles