Proposals to hit homeowners with higher taxes to reduce the inequalities in the housing market have been criticised by a leading broker.
David Hollingworth, mortgage specialist at London & Country, claimed there would be an ‘uproar’ among homeowners if the government implemented all of the measures outlined in a report published by the new Labour think tank, the Institute of Public Policy Research (IPPR).
The report claimed the value of privately-owned housing has risen from £36bn in 1970 to £1,525bn in 2001, creating ‘a massive gulf’ between housing haves and have-nots.
It called for radical action, including a raft of new taxes targeting middle class homeowners.
The measures included an end to the exemption from inheritance tax on ownership of first homes, higher tiers of council tax on more expensive properties, the introduction of full rates of council tax on all second homes, and a reduction in discounts on right to buy.
The report also called for a hike in stamp duty to regulate the levels of house purchases and sales.
The report’s author, Chris Holmes, added that steps needed to be introduced to reduce the North/South divide and the divide between tenants and homeowners.
He said: “Housing inequality has become the most extreme form of social inequality in Britain. There needs to be an overall national policy to increase territorial justice and a better balance between people, homes and jobs.”
Hollingworth claimed some of the report’s suggestions are already being addressed. For example, he said stamp duty has been increased in recent years, bringing more properties into the stamp duty bandings.
“The debate will go on, but whether they will be implemented is another matter. These measures would not go down well with homeowners and so I do not think you will see any immediate changes,” he said.