Potential FTBs frozen out of market
In a submission delivered to Downing Street, the NAEA calls on Darling to consider an incentive scheme such as the $8,000 First Time Home Buyer Tax Credit in the United States. The scheme, which is widely credited with stimulating the housing market, has since been extended.
FTBs purchasing any kind of home—new or resale—are eligible for the tax credit of up to $8000. The law defines FTB as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.
In addition to this the Association also suggested the following steps to boost the housing market:
• Make house building a priority
• Reform Stamp Duty Land Tax (SDLT)
• Suspend Home Information Packs (HIPs)
Comenting, Peter Bolton King, chief executive of the National Association of Estate Agents, said: “FTBs are central to a properly functioning housing market so it makes good economic, social and political for Mr Darling to consider a one-off stimulus for FTBs, similar to the incentive scheme in the United States.
“Although consumer confidence in the market is slowly being restored, low levels of supply in new housing and a lack of mortgage finance means the market is not moving as fast as it could.
“If Mr Darling is really serious about helping first time buyers, he needs to review pointless and expensive schemes such as HIPs and Stamp Duty which are impeding progress at a crucial time of recovery.”