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It is time for a stamp duty holiday
The pandemic, Brexit and a new prime minister mean that turbulence and change are the new norm for the housing sector. Ministers should consider a stamp duty holiday to bolster confidence in the housing market, writes Toyin Falade, launching a new series of blogs in Inside Housing by participants of the Leadership 2025 programme
What a time to be in the housing sector and what a time to market and sell new homes. Over the past two years, there have been several unprecedented events that have impacted the property market.
As a sector, we continue to navigate the complexities of cladding issues and policies, against the backdrop of leaving the European Union, welcoming a new prime minister, and now the brave march through the coronavirus pandemic.
Each of these challenges mean we have had to pause, review the way we work and do things differently.
The imminent challenge is the pandemic. This will affect all aspects of the UK housing market in the following ways, according to Savills’ market sentiment report in March there will be:
- General uncertainty, which will make prospective buyers nervous
- Negative impact on earnings and employment
- Short-term price falls between 5% and 10%
- Withdrawal of competitive mortgage products for first-time buyers
- Restrictions on people’s ability to go about their day-to-day business, which will impede normal estate agency, mortgage and conveyancing processes
With that said, it is not all doom and gloom. Prospective buyers are still looking, they are still enquiring about new homes and they are still reserving.
With most sales and marketing suites closing as the pandemic unfolded, One Housing enhanced the digital customer experience and developed virtual tours and viewings of our show homes. Sales consultants are also assisting customers via Zoom or FaceTime. During the first two weeks in March, Zoopla recorded a 215% increase in visitors who viewed new build homes virtually.
“A stamp duty holiday will provide a prompt for those who can currently afford to move but lack confidence in the market”
We must continue providing our customers the choice to virtually view our homes and speak with our new homes sales experts from the comfort of their homes. The G15 group of housing associations comes together weekly to share experiences and plans to move forward, so we are ready and stronger to accelerate construction and sales activities following lockdown.
We need the government to consider a stamp duty holiday once we come out of lockdown, as suggested by the Royal Institution of Chartered Surveyors. This will provide a prompt for those who can currently afford to move but lack confidence in the market. This will be one of the many ways to kick-start the housing market quickly.
Another upside is that households whose incomes remain stable and secure will be able to take advantage of historically low-interest rates.
Taking this simple step should support a return to stronger levels of price growth in the medium term.
Toyin Falade is director of sales and marketing at One Housing. This comment piece is the first in Inside Housing’s new series of blogs by the current cohort of Leadership 2025’s nine-month leadership development programme. The next cohort is now open for applications. Go to leadership2025.co.uk/applications
