With the Autumn Budget just days away, Aldermore is calling for an 18-month Stamp Duty holiday for buyers of new homes under £500,000 to stimulate sales and investment.
The lender is also calling for the Government to reinstate Help to Build with a Government-backed equity contribution of 20% for new builds when buyers contribute 5%
Aldermore’s First Time Buyer Index, a survey of 2,000 prospective first time buyers, shows strong demand for policy support – more than two-thirds (68%) say the Government and mortgage industry must be more creative with incentives; nearly seven in 10 (69%) support reintroducing Help to Buy; more than a third (35%) want increased support for affordable housing supply; and about a quarter (24%) want stamp duty relief or higher thresholds.
Aldermore managing director for savings and business finance Danielle Soto said that this week’s Budget was a critical juncture for the Chancellor to help unlock growth. She said that delivering more homes depended on simplifying the planning system and increasing infrastructure investment, but the house building sector – particularly SME developers – also needed certainty and targeted support to scale up delivery.
“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.
“First time buyers are equally in need of greater support – more than two-thirds (68%) say the Government and mortgage industry must be more creative with incentives and nearly seven in 10 (69%) support reintroducing the Help to Buy scheme. Nearly a quarter (24%) want Stamp Duty relief or higher thresholds. That’s why we’re calling for an 18-month Stamp Duty holiday for buyers of new homes under £500,000 – to stimulate sales, support first-time buyers and help smaller developers maintain cash flow.
Soto added that the Government needed to reinstate Help to Build as this would enable 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,” she concluded.
