Budget 2020: Young people call for housing help
NewsColony
Image copyright PA MediaWhether renting or paying a mortgage, under-35s are more concerned about housing than just about any other financial issue.
Members of the BBC’s Affordable Living group on Facebook were asked what they wanted to see for young people in Wednesday’s Budget – and the answer came back loud and clear.
“Rent controls and more tax on buy-to-let properties,” said James. “Then put that toward helping people buy their own house.”
Sarah echoed the call for controls on rents, saying: “Really annoys me that hard-up young people are paying for their landlords’ lifestyles.”
Trushar called for the abolition of leasehold properties, which have recently been the focus of an investigation by the Competition and Markets Authority.
He said that “would literally be the best thing Boris can do for young people”, adding: “I can’t consider buying a house whose value drops the moment I purchase and is full of unfair covenants.”
‘Growing challenge’
One would-be first-time buyer who would like to get a helping hand from Wednesday’s Budget is 29-year-old Andre Armenian, who wants to buy a property with his fiancée Siân Webb.
The couple have been saving money by living about 35 miles apart in their parents’ houses – him in St Albans, Hertfordshire, her in Romford, Essex.
Andre told the BBC: “I appreciate that there is only so much in the way of measures that can be applied to the housing market so as to maintain a healthy balance of demand and supply. However, something needs to be done to address the growing challenge facing first-time buyers.
“A revised version of the Help to Buy Isa would be a good start, one with more realistic house value caps. Under the previous scheme, I believe properties outside of London could only be worth up to £250,000 in order to be eligible for Help to Buy, which, if you’re only just outside the M25, isn’t very much money.
“Young people are having to buy properties further and further out from the towns and cities they work in, as these tend to be a little cheaper.
“Introducing some travel discounts or rail cards for first-time home owners, who have already laboured to get onto the first rung of the housing ladder, would help ease their financial burden.”
‘Vague promises’
However, it appears unlikely that Chancellor Rishi Sunak will unveil a major package of housing-related measures in the Budget.
Whitehall sources have made clear that the government’s financial priorities are based on delivering on the Conservatives’ election manifesto promises.
And the main plank of its housing strategy in that document was to continue progress towards its target of 300,000 new homes a year by the mid-2020s.
As for rent controls, they featured in the Labour party’s manifesto, but have never been embraced by the Conservatives.
Financial commentator Iona Bain, founder of the Young Money Blog, said the Budget should contain measures to shake up the housing market and help young people.
However, she feared it would be “business as usual”, with more “vague promises to build more houses that are not going to cut the mustard”.
She told the BBC: “We’ve still not seen the kind of ambitious radical reform that will allow young people to get on the housing ladder.”
Market reform
Ms Bain said that unlike many other younger people, she had managed to buy her own property, but was now “staying put” with no chance of moving to a larger place: “That’s the way it is now for first-time buyers.”
She called for measures to make the housing market “more transparent and functional”, including laws to stop developers sitting on land that had been approved for housebuilding while its value rose.
She also pointed out that new homes were often built in areas with no amenities and poor transport links, making them undesirable for young people.
“They’ve got to be the right homes in the right area at the right prices,” she said.
Sajid Javid, who resigned as chancellor last month after a row over merging his team with No 10’s advisers, has said he would have reduced stamp duty, which is a tax paid on most properties purchased in England or Northern Ireland, if he had stayed on to deliver the Budget.
But property consultancy BuyAssociation reckons Mr Sunak is unlikely to follow suit.
“Despite pressure on the government to use its powers to boost the housing market and encourage investment, a general stamp duty cut seems unlikely,” it says.
Source : BBC Business News | NewsColony: Business
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