Housing policy squeezes market for first-time buyers

Housing policy squeezes market for first-time buyers

Brokers, lenders and landlords alike have highlighted various inefficiencies in housing policy and potential headwinds that continue to blow first-time buyers off course.

For example, just under one in three house sales are falling through, according to one study.

And, while some may opine that ditching a fancy coffee could help youngsters put together a deposit, the facts remain that at approximately £53,000, the average deposit would equate to a dangerous amount of coffee consumption before one gave it up to start saving. 

While the stamp duty land tax holiday proved beneficial to thousands of households in 2021, what has been the impact on those would-be movers who missed the deadline?

In March, research by GetAgent.co.uk showed that, since the pandemic-inspired SDLT holiday came to an end, the amount of stamp duty the average homebuyer in England is required to pay is 84 per cent higher than it was before the tax break was introduced.

However, some areas, such as Preston, have seen this cost increase by as much as 881 per cent, rising from £33 before the SDLT holiday to £322 now.

Moreover, what has been the impact of the loss of local authority housing planning budgets and the tightening of planning permission restrictions?

Geoff Garrett, managing director of Henry Dannell, told the FTAdviser podcast this had a "significant effect" on housebuilding statistics and therefore on the amount of affordable housing available.

Fellow panellist Samantha Bickford, mortgage and equity release specialist at Clarity Wealth Management, said clients had been expressing concern about rising house prices and affordability criteria in the face of the cost of living crisis.

Also on the podcast, FTAdviser intern Calum Kapoor presents an overview of the mortgage market in March 2022.

To listen to the full podcast, click on the link above.

Simoney Kyriakou is senior editor of FTAdviser