Ahead of the Autumn Budget, Aldermore is calling for an 18-month stamp duty holiday for buyers of new homes under £500,000 to boost sales and investment.
The lender is also calling for the reinstatement of Help to Build, with a government-backed equity contribution of 20% for new builds, while buyers contribute 5%.
The scheme was an equity loan scheme aimed at those who wanted to build or custom build their own home. The scheme was withdrawn on 1 April this year, having launched in 2021 with over £150m in funding to “make it easier and more affordable for people to build their own homes”.
Danielle Soto, managing director for savings and business finance at Aldermore, said this week’s Budget is a “critical juncture” for the Chancellor to “help unlock growth”.
She continued: “Delivering more homes depends on simplifying the planning system and increasing infrastructure investment, but the housebuilding sector – particularly SME developers – also needs certainty and targeted support to scale up delivery.
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“While the government has striven to reach its target of building 300,000 homes a year, the data on completed homes to date demonstrates this ambition is currently out of reach. Therefore, we must search for more creative and far-reaching solutions. The housebuilding sector, and SME developers who find themselves disproportionately impacted by red tape and complexity in particular, requires more certainty in order to achieve this.”
Soto noted that first-time buyers were “equally in need of greater support”, with its First-Time Buyer Index that surveyed 2,000 prospective first-time buyers noted that 68% said the government and mortgage industry must be more creative with incentives.
Nearly three-quarters – 69% – support reintroducing the Help to Buy scheme, which ended in 2023. The scheme ran from 2013 to 2023 and supported the purchase of around 387,195 properties, 328,346 of which were by first-time buyers.
Almost a quarter want stamp duty relief or higher thresholds, given the first-time buyer stamp duty relief threshold was cut from £425,000 to £300,000 on 1 April 2025.
Soto said an 18-month stamp duty holiday for buyers of new homes under £500,000 would “stimulate sales, support first-time buyers and help smaller developers maintain cash flow”.
She added that a Help to Build scheme would allow “smaller builders to re-enter the market and accelerate delivery of new homes, especially in regional areas where major housebuilders are less active”.
“While there is no single solution, these measures would provide meaningful help to both SME housebuilders and first-time buyers,” Soto said.
