News

News

Stamp duty threshold change 'needs to go further'

movewithus has today called on the Government to urgently re-consider the increase in the stamp duty threshold and extend it to £250,000.

Robin King, founding director of movewithus, said, “The increase in the stamp duty threshold has naturally been welcomed but it will fall a long way short of having the desired effect of kick starting the property market and could be a catalyst for worsening conditions.”

movewithus believes that the move will have a significant impact on the 20 per cent of houses currently valued between £180,000 - £200,000, predicting that these properties will experience a major reduction in their value to be eligible for the new stamp duty exemption.

King commented: “The Government should not delay in raising the stamp duty threshold to £250,000, in order to allow people throughout the UK to benefit from the change and to steady the market at a crucial time.”

According to movewithus, the fundamental issue preventing a recovery in house sales at present is not the stamp duty threshold but buyers’ inability to secure a deposit. 

King remarked: "The ‘free 30% loans’ initiative, which is currently only open to first-time buyers who purchase new homes, should be extended to include all properties, giving first-time buyers more choice and injecting liquidity into the whole market."

King concluded, “To deal with rising repossessions, we suggest a Government-backed ‘Prepossession’ scheme. This would consist of the Government working with Lenders to give borrowers on the verge of repossession the chance to pay a more affordable commercial rent, avoiding an unwanted repossession for both the Lender and borrower. Accepting a decreased payment in the short term is more prudent for Lenders, considering the costs associated with repossessing and reselling properties in a falling market. By charging a realistic market rent, Lenders can ride out the downturn and see their asset increase in value while still receiving a regular income."

"As effective owners of the Northern Rock, the Government has a clear opportunity to instigate proactive measures such as this, which would encourage other Lenders to do more to stem the current market crises."

Source

http://www.movewithus.co.uk/mwu-news/00,news,55027,468,00.htm (launches a new window)

< Back

News

11 November 2008
Opportunities for first time buyers may be on the horizon

10 November 2008
movewithus believes rate cut may mean house price stability by June 09

08 September 2008
US Government intervention ‘better than stamp duty cut’