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TODAY'S OTHER NEWS

Stamp Duty and conveyancing are growing worries for home owners

A large-scale survey by a consumer group has revealed that over half of home owners regard stamp duty as a growing problem; conveyancers’ fees, the rise of gazundering and threat of negative equity are increasingly worrying too.

The HomeOwners Alliance’s annual survey - involving a sample of 2,000 and regarded as a snapshot of home owner sentiment - lists a range of issues that are of increasing concern for the home-owning public.

Quality of housing, especially new-build, comes out as the largest worry but stamp duty rates and the threat of gazundering come next; in addition to the recently-publicised problems of the leasehold system, the next biggest worries are solicitors’ fees, the threat of negative equity and gazumping.

There’s been no change in sentiment about estate agents’ fees, while house prices and the ability to secure a mortgage - once seen as bigger issues - have fallen back in terms of concern for existing owners.

“People crave more certainty in the housing market – that the price agreed at point of sale will be the price paid. Reservation agreements to be piloted by government should reduce peoples’ concerns over gazunderng and gazumping” explains Paula Higgins, the HOA chief executive.

Higgins also wants the government to abolish the leasehold system. 

“If the government was really serious about this then they should commit themselves to widespread reform instead of the piecemeal approach they have adopted - making well intentioned announcements with no timetable for action. They can’t hide behind Brexit while homeowners continue being mis-sold leasehold, left trapped in their own homes with rising ground rents and unable to buy the freehold” she states.

The survey is supported by BLP Insurance and its chief executive Kim Vernau says the results “cast another dark shadow over a housing industry rife with systematic faults.”

Vernau continues: ‘The government scheme has buoyed the residential sector, keeping prices artificially high, but cracks have started to appear, and its collapse could leave thousands of first time buyers stranded in negative equity. In an already stagnating market, where harmful practices like guzundering are commonplace, poor quality of build and the plausible threat of depreciating asset value are compounding pre-existing caution from potential buyers and investors.”

The table showing those topics of growing and falling concern to owners is below:

Housing Concerns

% very/ somewhat serious problem

2014

2015

2016

2017

2018

2019

2019 vs 2018

Quality of housing

52

49

52

57

57

63

+6

Stamp duty rates

64

51

52

53

50

55

+5

Gazundering

*

*

40

*

40

45

+5

Leasehold/ freehold system

n/a

42

42

50

56

60

+4

Property/ solicitor fees

61

53

50

55

53

56

+3

Availability of housing for over 60s

n/a

n/a

n/a

47

43

46

+3

Negative equity

64

49

44

42

42

45

+3

Gazumping

52

49

45

51

47

49

+2

Ability for First-time buyers to get on the property ladder

87

83

82

86

86

87

+1

Saving for a deposit to buy

86

83

80

83

84

85

+1

Being able to pay off the mortgage

70

65

64

63

63

64

+1

Estate agent fees

64

57

54

59

58

58

0

House prices

77

76

78

82

83

82

-1

Availability of housing

69

70

72

76

77

76

-1

Ability to get mortgage/ remortgage

n/a

72

68

70

65

64

-1

Homebuying/ homeselling process

58

51

50

53

53

52

-1

Being able to move up property ladder

65

61

62

58

61

59

-2

Sample size (total UK adults):

2527

2214

2095

2081

2110

2195

                 

*Gazundering change compares 2018 vs 2016

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    We recently attended the London home show and upon speaking to many first or second time buyers by far their biggest concern was stamp duty and the amount of tax they would pay. There does seem to be a shortage of knowledge when it comes to this property tax particularly in relation to first time buyers who can’t get their heads around the amounts they have to pay.

    Stuart Forsdike
    PCS Legal

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