The Spring Budget came as a disappointment for anyone looking to get a foot on the housing ladder. There was a distinct lack of announcements concerning Lifetime ISAs (contrary to expectations), no replacement for Help to Buy and no changes to Stamp Duty thresholds, a disappointment for many.
Just days ahead of the key fiscal event, the Chancellor had already scrapped plans for 99% loan-to-value (LTV) mortgages for first-time buyers following resistance from the banking community.
The scheme would have seen home buyers able to put down a 1% deposit on a new first home, with the government backing the overall loan, but bankers warned it would push up defaults.
Silence – not golden
Reaction from industry professionals was largely negative, with Tim Bannister from Rightmove commenting, “We had hoped the government would seize the opportunity to help first-time buyers and reform the outdated Stamp Duty system today. Instead, home-movers were left with extremely little and the temporary Stamp Duty thresholds weren’t even made permanent, meaning more will pay higher rates of Stamp Duty next year, unless the government makes them permanent in the autumn.”
Jonathan Stinton from Coventry Building Society said the silence around housebuilding was deafening, adding that the Budget, “could have been an opportunity to present new innovative schemes which help buyers with affordability as well as saving for a deposit – but not even the bare minimum was done. It’s not only incredibly disappointing, it feels like a big mis-step on the Chancellor’s part. First-time buyers are the foundation on which the rest of the housing market stands. Failing to give them proper help is failing to help the rest of the market.”
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