Five-point plan to boost sales
The August housing market report from the NAEA showed a slight decrease in both the supply of property and demand from prospective buyers.
The NAEA is calling on the new housing minister Mark Prisk to follow its five-point plan to make it easier for first time buyers to get on the housing ladder, and less expensive for existing homeowners to move.
NAEA president Mark Hayward said: “While the ‘Olympic Effect’ did to an extent impact the level of demand and supply, as it did with a number of related industries, the underlying issue of lack of adequate funding mechanisms is still the stumbling block, preventing many prospective homeowners from getting onto the property ladder.”
“This is a situation we have been striving to encourage the Government to change for far too long. Concerns amongst potential buyers about job security, the size of deposits required and prohibitive levels of stamp duty mean that overall levels of home ownership are at their lowest rates for 20 years.
“We hope the new housing minister will consider our action plan to bring a much needed injection of activity to help promote stability and growth in the market.”
The NAEA action plan calls on the Government to:
1 Introduce Government regulation of letting and sales agents
Estate agents and letting agents are currently unregulated, meaning anyone can set up an agency without appropriate qualifications or knowledge. The Government needs to develop a nationwide regulatory regime, to ensure consumers are protected across the UK.
2 Comprehensively reform stamp duty, ruling out any new taxes on residential property
The current ‘slab structure’ of stamp duty distorts the UK housing market and places a disproportionate burden on first time buyers. The Government needs to modernise the duty, moving away from this ‘slab’ structure to create a fairer, more logical system.
3 Provide support for first time buyers looking to save for a deposit by increasing the annual limit for ISAs and set up a Government-backed saving scheme
With 90 per cent of first time buyers now needing support from their family to buy a home, it is vital that the Government finds a way to provide incentives for people to save for a deposit earlier in life.
4 Build significantly more homes to increase supply
Housebuilding should be a top priority, in light of the current supply of homes for sale and rent. The Government must examine alternative methods to increase supply such as transforming vacant high street property into much-needed housing in certain areas of the country.
5 Work closely with lenders to ensure that lending criteria are appropriate
While the NAEA recognises the need for responsible lending, this shouldn’t curtail sensible lending. Many first time buyers need to borrow substantial amounts of money to get onto the housing ladder, which is proving increasingly difficult and criteria becomes more restrictive.