As the election comes to a close and the Conservatives strive to deliver on their winning manifesto, many people, including those looking to buy, sell or build property will be pleased with a ‘party of homeownership’ pledging to go ‘further and faster’. Those that were worried about the Labour party’s ‘mansion tax’ are probably breathing a sigh of relief and there is a general feeling of support for the property market. This feeling of goodwill and confidence in the market will get another boost when the ‘housing bill’ is delivered.
As will meeting London’s housing needs, creating a new London Land commission with a mandate to release all surplus Brownfield land owned by the public sector. In addition, the Government plan to devolve further powers over spending and planning to the Mayor of London, which will be welcome.
There is an overriding focus on strengthening the economy, which is good for everyone in property; the Government will aim to, ‘eliminate the deficit to keep the economy secure, keep taxes and mortgage payments down…’ They will seek to pay down debts as the country enters a surplus for the first time in 18 years; this will reduce the scale of annual interest payments and reduce the UK’s vulnerability to future financial shocks.
There will be a new fiscal policy, monitored by the Office of Budget Responsibility (OBR), to run a surplus and continue to reduce debt and introduce a new financial policy committee to regulate the financial services industry; monitoring debt and imbalances across the country. A tough new financial conduct authority will ensure that financial markets work for the benefit of the whole economy. The government will also continue to sell stakes in bailed out banks to deliver value for money for tax-payers.
The note of caution is around delivery of new homes at the levels required. This will require a brave government making significant changes to the planning process and cutting the current barriers. Successive governments have tried to solve this without success, so the big question is whether this government can be any different?
So what is the new Government looking to deliver?:
- Double the numbers of first-time buyers, by increasing the availability of new homes especially in the South East, helping more people achieve home ownership.
- Build 200,000 new homes and introduce a new Help to Buy ISA.
- ‘Support locally-led garden cities and prioritise Brownfield development, making sure new homes are always matched by the necessary infrastructure to support them.’ Which is good for selling homes, attracting tenants and investors.
- Not raise VAT, National Insurance or Income Tax (increase tax free allowance to £12,500) and raise the 40p Income Tax threshold to £50,000
The government will continue the Funding for Lender scheme to inject fresh competition into the market resulting in better deals for those looking for mortgages.
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