1. Govt: Waive Stamp Duty for second-time buyers
Government should consider waiving Stamp Duty altogether or have a two-year holiday period for second-time buyers up to an agreed maximum.
This part of the housing market is stuck and restricting choice for first-time buyers entering the market.
Managed carefully, it shouldn’t result in too much supply of property to the market, so any argument that this might reduce asking prices feels wrong. Consumer confidence, equity levels and mortgage finance aren’t sufficiently in supply for this problem to occur.
Motivating those thinking about moving to do so will help get the market moving again and have a wider, very positive knock-on effect on the economy and employment.
2. Govt: Get more new homes built, in the right areas
We need more choice. It would help the construction sector and wider employment, and give more people the chance to find a new home that they need, as opposed to being long-term renters.
3. Industry: Dispel the myth of mortgage availability
As an industry, we need to work together to make people fully aware of all the options available to them. Many think they can’t get a mortgage when they can or are saving for a huge deposit, but may be able to buy more easily.
4. Industry and govt: Free up long-term renters
Tenants who have rented for many years and built up a great track record of repaying high levels of rent in a disciplined manner on a monthly basis constite an acceptable risk for lenders and should be helped into buying their first home.
More promotion should be done by the industry to court and provide mortgage products specifically for long-term, top quality renters.
In 1993-5, many were stuck in negative equity. Lender innovation at the right time freed this market up where it had been stuck before. In a totally different world today, we are stuck for different reasons and need the market to release. Innovation can help with this.
5. Intermediaries: Best placed to provide a solution
Well over 90% of all intermediaries offer not only breadth of mortgage choice, but full advice. Merely one third of all lenders can offer advice in this way and none can offer the same range of products that an intermediary can.
Intermediaries should work hard to help customers to understand this, where research shows many simply don’t. This would result in better informed and happier customers.
6. Advisers: Help borrowers to make the right choices and fix
Identify the one in three borrowers that would now pay up to £1,200 more to fix their mortgage rate. Rates are at an all-time low; there has arguably never been a better time to broach this discussion.
7. Industry: Make both children and parents aware of FTB options
Typically, it’s children who explore the guarantor options and most are not aware of what products might exist today. The likes of Aldermore and Nationwide are working hard to help and more innovation is expected this year.
Intermediaries and lenders all have clients in their 50s and 60s and should proactively clarify what options they might have to help their children onto the property ladder.
8. Borrowers: overpay your mortgage or offset it
The fortunate few who have spare cash could do a lot worse than to reduce their mortgage debt.
Banks could do with the money back, overpayments represent a guaranteed return usually at rates far better than retail savings rate and, of course, any borrower that does this will increase their equity and put themselves in a better place for future moves.
Check terms and conditions with your lender and, remember, once overpaid you might not be able to get your cash back.
9. Homeowners: take advantage of a low Bank base rate
Most experts predict base rate will stay at 0.5% for many more months yet. What is your plan if you are benefitting from this? Are you simply going to spend any extra cash or can you save lots for future moves or home improvements.
If you are able to, now is a good and cheap time to secure reduced-cost labour on home improvements, thereby increasing your living standards and house value and spreading your wealth to other sectors that might need the extra work.
10. Everyone: Emphasise the positive
Nobody wants to kid a kidder or falsify how good things are, however, there is a balance.
Bad news has been trending now for four years or more and sooner or later consumers and businesses look for good news and grow tired, if not immune, to grim headlines and results.
Let’s all make a point of more widely covering the good news and contributing to the UK economy and housing markets getting back onto their feet again – this cannot happen too soon and at least we’d all feel better.
