Bad start to 2010 for house buyers
The New Year will start with bad news for house buyers, particularly those trying to purchase their first home. The ending of the stamp duty holiday means that many more properties will attract the tax. While this may amount to just £1,250 on the average transaction, it is a burden that many people can ill-afford.
First-time buyers already have to find a 10% deposit - a considerable sum given the average house price in Ulster is around £164,000 - and when they add in legal fees, furnishings and now stamp duty it is little wonder many find the cost of owning their own home too daunting.
The recovery in the housing market has been painfully slow since the property bubble burst and everyone is keen to ensure that there is not another period of boom and bust fuelled by easy credit. Yet the construction industry is vital to the economy and it desperately needs to see a steady, sustained return of confidence in the housing market. The axing of the stamp duty holiday will do nothing to stimulate growth.
With a General Election likely in the first half of the new year, whoever forms the next Government will have a delicate balancing act to perform. How can they make it easier for people to buy a home while guarding against unrestrained growth in prices? A root-and-branch examination of the property market is required, from the supply of mortgages to stamp duty threshholds, and innovative measures such as the part-rent, part-purchase schemes should be given greater funding to enable them to compete in a crowded market place.
Social housing cannot cope with the demands made on it and many people who want to own a home are being driven into private rented accommodation, costing just as much as a mortgage but with none of the investment advantages. The very least they deserve is to be given a realistic opportunity to realise their dream purchase.