Labour bid to help renters buy sets alarm bells ringing

Labour’s proposed reforms to the housing market “raise many questions”, a property industry figure claims.

Under controversial plans put forward by party leader Sir Kier Starmer and shadow housing secretary Lisa Nandy, agents would be banned from selling new builds to anyone who has previously owned a home.

The proposals would see first time buyers given “first dibs” on new properties, but the plans have been questioned as unworkable and unfair.

Commenting on the idea Jonathan Rolande, from the National Association of Property Buyers, says: “Labour’s plans show good intentions to take positive steps to intervene in the property market, to re-balance it and to make it fairer.

“On the other hand, it makes me very wary. Government interventions have failed in the past, making difficult situations worse. Will this be different?  The proposal raises many questions. Will it become illegal to sell one of these earmarked properties to a non-first time buyer? Does the first timer have to commit to living there? Who will build them knowing that the market is very limited and therefore prices will be lower? Will that lower price be reflected in the land cost? If so, might that mean fewer people get planning consent meaning fewer properties will be built? 

“It’s all too early to say. But I struggle to see why such a bold move is needed when the system is already balanced in the first-timer’s favour. They already receive a large discount in stamp duty – on a £250,000 home this amounts to a zero liability for a FTB, £7500 for a second-time buyer and £12,500 for an overseas investor. 

“These thresholds could very easily be altered to give the first time buyer even more advantage and the impact on the planning system and builder’s willingness to build the new homes we desperately need would be reduced.”

The NAPB is also claiming that the country was slipping behind on its house building programme in the wake of the Government’s decision to scrap targets.  

Analysis of the latest official data by the NAPB, found 46,230 properties were constructed in England between April and June last year, which is about 500 a day.

That’s way off the Government’s previously stated target of around 830 a day. 

Rolande adds: “The rate of new builds is not even keeping up with demand, let alone doing anything to put right the backlog of property building that has developed over decades. Population growth and the increases in the formation of households mean that more people are competing for relatively fewer properties to buy or rent like some awful game of musical chairs. The shortage of property leads to spiralling prices and rents and impacts almost every aspect of our lives including health, social mobility, family structures and the wider economy. We urgently need more homes.”

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