The MP who chairs one of the most important committees in the House of Commons has urged the government to increase stamp duty immediately to stop runaway house prices and investors treating properties as assets, not homes.
Meg Hillier is the chair of the Public Accounts Committee, which is charged with overseeing government spending, has told other MPs in a debate: “We need to increase stamp duty immediately, while monitoring its effect, and we should increase it further for overseas purchasers.
“We should not have a housing market that has led to homes being owned by finance vehicles or absentee landlords who have no interest in it being a home but simply see it as an investment. Homes should be homes.
“Investment is all very well, but this is really damaging the future prospects of children in my constituency, some of whom will never have not only their own bedroom but maybe even their own bed between now and when they hopefully earn enough money to leave home, although frankly we are a long way off their earning enough money to buy a £750,000 flat.
“The government really need to step up. They talk about levelling up, but that is certainly not happening for many people in my constituency.”
Hillier is Labour MP for Hackney South and Shoreditch, and in the House of Commons Register of Interests’ Land and Property section has an entry dating back to 2015 saying: “A property in London from which rental income is received.”
In the debate Hillier also said: “The stamp duty holiday has been helpful to many people, but all that contributes to fuelling demand for housing while the government are not increasing supply.
“Those rising house prices put homeownership out of reach of so many of my constituents and people up and down the country. It is having a major dampening impact on people’s lives and livelihoods and on the economy in the long term. It does nothing for private renters and nothing for those in desperate need of affordable housing.”
Much of the debate was given over to the new two per cent stamp duty surcharge o non-resident overseas buyers, introduced just over a month ago. Hillier did not believe it went far enough.
“Although we are seeing a two per cent uplift, it is not what was originally promised, and even that, I would say, is still not enough to prevent people from speculating, particularly in my constituency and elsewhere in London, on the expensive London housing market and overheating that housing market.”
She added: “The excuse is often that developers need the money because they cannot operate without that cash-flow model. I think they would adapt pretty quickly. In my constituency, there are blocks that local people have kept their eye on, wanting to try to buy, only to find they have already been sold en masse overseas. A stamp duty increase would help a little bit.”
Hillier also gave MPs examples of individuals she met at her constituency surgeries, working for the NHS and living in rented accommodation with little likelihood of being able to afford to buy their own homes.