Category: Finance

Rightmove has set some of the key priorities the next government should tackle, which includes boosting housebuilding, lifting first-time buyer support, stamp duty reform and greater green incentives.

The priorities were based on views from Rightmove experts and agents, and research among over 14,000 homeowners and renters.

Top of the list was a reform of the stamp duty system. If a new stamp duty system took into account regional property prices or helped encourage more people to downsize, it could help movement in the market.

Data from Rightmove shows that in London, only 4% of homes for sale are exempt from the current stamp duty charges for all buyers, compared to 71% in the North East.

The second most requested change from homeowners is to simplify and speed up the homebuying process.

It is currently taking over seven months from when someone puts their home up for sale until they move.

Previously, more UK consumers had residential mortgages — mainly variable rate. So, when the MPC increased the base rate, households felt it immediately. When the base rate hit a 15-year high of 5.25% in August 2023, 1.4 million people who were still on a variable rate suddenly had to find hundreds more pounds to cover future bills.

Critics say the causal nature that successive Conservative governments treated housing policy is demonstrated by the fact that Micheal Gove was the head of this department – twice.

He was secretary of state for levelling up, housing and communities between September 2021 and July 2022, before the person widely regarded as the most competent in the cabinet was sacked by Liz Truss.

He was brought back by Rishi Sunak in October 2022 until last Friday, when he announced he would not stand at his Surrey Heath constituency in next month’s general election.

This leaves the property industry asking one question.

Was Gove – who pushed through academies and cut back on the use of consumer plastic use as head of education and the environment – good for housing?

He famously called UK housing “broken” and said leaseholds were “a feudal system that had to go”.

While many ministers spend their careers taking on bills started by others and shepherding them through for 18 months or so, until they in turn were moved on, Gove had a reputation for initiating his own legislation and driving it through.

The Bank of England is likely to make its first cut to base rate in summer, according to the latest forecasts.

This week, the UK’s central bank opted once again to hold the base rate at 5.25 per cent, marking its sixth pause in a row.

It means the base rate has been stuck at its current level since August last year.

Economists are now divided on how far rates will fall in the second half of this year. 

Base rate could fall as far as 4 per cent by the end of this year, according to the latest forecasts from Capital Economics.

Others forecast just one or two cuts from the current 5.25 per cent level to 4.75 per cent by the end of this year with the first coming in either June or August.

Around 31% of brokers said that stamp duty reform is most needed for downsizers and buy-to-let (BTL) landlords respectively, a Mortgage Solutions poll has found.

According to the poll, this was followed by stamp duty reform for first-time buyers at around 21% and then second steppers at 17%.

Stamp duty reform is not a new topic for the mortgage industry, with the latest Budget including scrapping multiple dwellings stamp duty relief and stamp duty for nominee purchases.

However, many industry figures believe that the measures did not go far enough, with some calling for downsizer stamp duty to be abolished, improved regional variation and BTL stamp duty to be examined.