The Conveyancing Association says new Chancellor Phillip Hammond should use next month’s Autumn Statement as the opportunity to reverse controversial buy to let tax initiatives introduced last year by George Osborne.
“We’ve seen rather more than a traditional, seasonal housing market drop-off over the summer. The impact of the three per cent increase in stamp duty charges for additional properties has been sizeable and we’ve seen considerable falls in buy to let purchase activity although remortgaging has improved” says Eddie Goldsmith, chairman of the Conveyancing Association.
He claims the anticipated boost that Osborne’s measures were supposed to give to first-time buyers appears not to have materialised. The latest figures from the CML show that landlord borrowing was 21 per cent down year-on-year in July, while first-time buyers’ borrowing was down 19 per cent month-on-month and four per cent down year-on-year.
“[This is] hardly the renaissance in first-time buyer activity we were led to believe would result from buy-to-let activity being forced downwards” claims Goldsmith.
“When you add in the uncertainty wrought by the result of the EU referendum, the impact across the entire housing market is sizeable. Transaction levels have dropped over the past few months, the market is subdued to say the least and this clearly impacts on the conveyancing sector” he adds.
Now he says Hammond has an opportunity to reverse the three per cent additionalk homes SDLT surcharge and make a U-turn on landlords’ reductions in mortgage interest tax relief set to start next April.
“Theresa May’s ‘new’ Government and Philip Hammond therefore have an opportunity to make a significant intervention that would benefit all stakeholders. We would urge them to take the appropriate action required to support a market which is absolutely pivotal to the health of UK plc” says Goldsmith.