More help needed to get young people on housing ladder

More help needed to get young people on housing ladder

Reporter:

David Booth

The number of first time buyers in the UK has risen to a 10-year high.

This is thanks to extremely low mortgage interest rates, record employment and help-to-buy schemes.

An estimated 335,750 people bought a house or a flat for the first time last year, up seven per cent on 2015.

According to building society and bank Halifax, that was the highest level since 2007 when the number across the UK reached almost 360,000 before falling to 192,300 in 2008 when the financial crisis struck.

The state-funded Help-To-Buy loan scheme provides loans for buyers of newly-built homes up to the ceiling price of £300,000 – enabling buyers to purchase with a five per cent deposit.

Buyers now pay no stamp duty on homes costing up to £125,000, two per cent on the next £125,000 to £250,000, five per cent on the next £675,000 to £925,000, 10 per cent on the next £575,000 to £1.5m, and 12 per cent above that.

The Welsh Government is introducing a ‘Land Transaction Tax’ to replace ‘Stamp Duty’ in April 2018 – the first time since the 13th century that Wales has had tax- raising powers. 

Finance secretary Mark Drakeford described it as an historic milestone in the devolution of tax powers to Wales.

“This Bill marks another step towards the creation of taxes which are more suited to the needs of Wales and support Welsh public services,” he said.

“This is a tax which affects so many of us. By replacing Stamp Duty land tax with a new made-in-Wales Land Transaction Tax, public services in Wales will continue to benefit from the revenues raised by this important tax.

“We have consulted widely about how this tax should work for Wales and listened to a range of views.

“This is why it will broadly mirror Stamp Duty land tax, providing the consistency and stability businesses tell us they need and providing a smooth transaction for home-buyers and the property market.”

In 2014-15, Stamp Duty earned the Welsh Government £170m on 55,000 transactions,

The average paid for a home by a first time buyer in 2016 was £205,170 but that includes the affluent south east of England, 

In Wrexham and Flintshire the cost would be much lower, but in Chester it would be closer to £200,000.

All good news then? Well, no actually.

The one worrying factor is that the average age of a first time buyer is 30. Something needs to be done to cut that average age.

Email:

david.booth@nwn.co.uk

See full story in the County Times

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