BUDGET 2024 - Property and mortgage market activity unlikely to be improved by Budget - Rob Clifford, Stonebridge
07 March 2024
“After the damp squib of an Autumn Statement, there was an optimistic expectation the Budget would deliver a number of property and mortgage market-friendly measures which would encourage more transactions, and would help in a number of key areas, not least boosting housing supply, first-time buyer access to affordable homes and finance, plus potential action on stamp duty in order to get the sector moving again. All the talk and the running up the flagpole of various potential policies, such as 99% LTV mortgages or a replacement for Help to Buy, have not made it to the Budget announcement.
“What we do appear to have though is a series of policies which are likely to make ongoing property investment more expensive, with the furnished holiday lettings tax regime being abolished, relief on multiple dwellings stamp duty also being removed, at the same time as the higher CGT rate on residential property will be cut from 28% to 24%. This may provide the catalyst for more buy-to-let landlords to divest of properties within their portfolios, and perhaps some will say this will indirectly increase property transaction levels and make these homes available to first-time buyers. That remains to be seen, however what it might also do is further reduce the number of homes available to rent, at a time when tenant demand remains incredibly strong – that is likely to mean further increases in rent levels.
“We wait to see how these specific measures do impact the sector, but it is clear this feels like another missed opportunity to move the dial on activity in the property market, to help increase the supply of new homes, support first-time buyers further, and put in place a long-term plan that gives greater confidence and opportunities to those who want to buy and sell. In that sense, I suspect the Chancellor has ignored the chance to boost one of the main planks of the UK economy.”
