The statement tends to focus on economic growth and government finances with UK borrowing figures and targets a given. The media coverage in the run up had signalled that little or no ‘give-aways’ were likely.
Having campaigned for change for the past six years I hoped (again) that reform of the Stamp Duty Land Tax would get a look in, but the most I’d anticipated was a commitment to review it.
So the rabbit that the Chancellor pulled out of the hat – complete reform from midnight on 3 December was a welcome surprise.
The abolition of the slab structure and the move to a progressive tax was overdue, and gets rid of the crazy jumps in taxation around the thresholds.
No buyer would be rash enough to buy a house at £250,001, but if they did, for that £1 they’d pay an extra £5,000 in tax. Now this sort of cash is available to bolster a deposit or go towards other moving costs.
This may be particularly welcome in London and the South East where more and more people are finding themselves the wrong side of the 3% threshold.
Since the announcement we have seen some concerns raised about buy-to-let: will the change in stamp duty just see more average priced/first time buyer type properties being hoovered up by landlords?
I don’t think so. Buy-to-let is a commercial decision and whilst a few extra pounds may weigh in the scales, it is unlikely to prompt extra unplanned buying on a material scale.
More importantly we are starting to see buy-to-let, and the landlords it creates, being vilified in the press as ‘money grabbing landlords’.
Clearly I can’t speak for them all, but we’d do well to remember that a vibrant private rented sector is a positive thing and that until and unless institutional investors come into the market big-style we rely quite heavily on buy-to-let landlords to provide the supply.
Paul Broadhead is head of mortgage policy at the Building Societies Association
