The Conservative Party’s 2024 manifesto promises to revive the Help to Buy scheme if they win the upcoming general election. This scheme aims to support first-time buyers with an equity loan of up to 20% for new build homes, requiring only a 5% deposit. This initiative will be partly funded by contributions from house builders.
Help to Buy Scheme: An Overview
The Help to Buy scheme, originally launched in 2013, offered a five-year interest-free loan of 20% of the property value for first-time buyers who could provide a 5% deposit. The scheme only applied to new-build homes and was updated in 2016 to include a 40% interest-free loan for properties up to £600,000 in London. Despite several extensions, it ended on March 31, 2023.
Expert Opinions
Simon Gerrard, Managing Director of Martyn Gerrard Estate Agents, criticizes the manifesto, calling it “devoid of imagination” and “out of ideas.” Gerrard notes, “Reviving Help to Buy is a good idea, but it’s meaningless if there are no homes to buy. Lowering the loan-to-value and purchase thresholds in London is perplexing given the rise in property prices.”
Current Market Conditions
The average house price in London is £499,663. First-time buyers using the Government’s Lifetime ISA scheme must not exceed a £450,000 cap or risk losing their bonus plus interest. Critics argue that the Help to Buy scheme previously drove up property prices in London, putting buyers at risk of negative equity.
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Stamp Duty Changes
The Conservatives also pledge to scrap Stamp Duty for first homes under £425,000 permanently. Currently, first-time buyers pay zero Stamp Duty on homes up to £425,000 and 5% on the portion between £425,001 and £625,000. Gerrard believes this isn’t enough and calls for a complete revamp of the Stamp Duty system to encourage downsizers and free up properties for young families.
Renters Reform Bill
The manifesto promises to reintroduce the Renters Reform Bill, aiming to abolish Section 21 no-fault evictions. This move aims to balance the rental market for both landlords and tenants. Ben Beadle, CEO of the National Residential Landlords Association, emphasizes the need for a balance between tenant security and landlord confidence to deliver much-needed rental homes.
Tax Relief for Landlords
A new proposal in the manifesto includes a two-year temporary Capital Gains Tax relief for landlords who sell their properties to tenants. This aims to prevent tenant homelessness when landlords sell. However, Graham Boar from UHY Hacker Young warns this could create a loophole ripe for abuse.
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Conclusion
The Conservative manifesto brings back the Help to Buy scheme and proposes new housing policies. However, experts criticize it for lacking innovative solutions to the housing crisis. For those needing a quick home sale, Angel Properties is here to help. Contact us now and simply enter your address at angelproperties.uk to get your free valuation.
External Links:
- Royal Institution of Chartered Surveyors
- Labour Party Housing Policies
- Conservative Party Housing Policies
Original Link: https://www.standard.co.uk/homesandproperty/property-news/conservative-manifesto-2024-housing-policy-reaction-b1163675.html
