could someone sum up in a few words what was actually said and how it will effect us. for example, i expect to graduate fingers crossed with a good degree and should get a job paying a good 25k a year at least (hopefully that is!). My girlfriend will be in the same boat exactly, so how would this effect us do you think?
Ive been harping on for ages about why nobody ever mentions stuff like this, i mean its almost impossible to save a decent deposit whilst paying rent.
Budget - First time house buyers watch
- Thread Starter
- 23-03-2011 21:10
- 24-03-2011 00:14
I have skim read the treasury outline (240 pages)
Ignoring the parts of the budget covering economic forecasts, there is very little re the housing market.
The changes that are meant to take place re the planning process will eventually lead to increased supply of sites/buildings for development, however until some house price stability is restored funding development will remain very difficult . Consequently without demand prices could carry on sliding. This of course favours cash/equity rich buyers, but does not assist limited equity buyers, yes the prices will be lower but they still cannot buy as they cannot raise the necessary deposit.
The only part of the budget re housing that may impact the individual buyer was the change is stamp duty on purchases of multiple houses. Reducing the stamp duty rate re multiple house purchases, as proposed, will allow providers of rented housing to acquire stock slightly cheaper. Once builder's unsold stock is removed from the supply chain in theory remaining prices may stabilize.
I am not however convinced there is enough "discount" to spur institutional landlords, if the numbers barely stacked before they really will not have improved enough to move a non viable to a viable.
I think he missed a trick in not permitting/encouraging pension schemes to start acquiring residential property, this would have helped stabilize prices and over time might have helped persuade mortgage lenders to reduce LTV criteria.
I have spent a fair part of the last year meeting with banks (I work for a property investment/ development Group) and have yet to detect any appetite from any of them to finance residential development. All of them are cautious re pricing, and given a typical small housing development (25-30 units) may take 3-7 years to complete and sell, very few are willing to help unlock the delivery programme re housing.
I have a great deal of sympathy for your position, the first time buyers market appears to be split into those with family financial backing and those without. Until banks are confident enough to increase LTV ratios I suspect price slides may continue.