Homes sold in Britain dropped to their lowest numbers since 1959. Among the many factors affecting home sales was the government’s delay in changing Stamp Duty tax to make buying more affordable, says the Guardian.co.uk
The government went on to say that only 62,000 houses were sold in August this year, or less than half the numbers of August ‘07. Additionally, the British Bankers’ Association (BBA) confirmed that mortgage approvals dropped significantly by 64% (up to last month).
BBA statistics director David Dooks said, “The low number of mortgage approvals in previous months predicted lower gross lending in August and, together with remortgaging, a much weaker net lending figure than of late resulted.
“Falling property prices, economic pressures on households, tighter lending criteria and anticipation of the government’s announcement on stamp duty all suppressed or delayed demand in August and will continue having an impact.”
Meanwhile, the chief economist at RICS, Simon Rubinsohn, said, “The subsequent decision by the government to widen the zero band on stamp duty, albeit only temporarily, alongside the introduction of more competitive mortgage products by lenders should have helped bolster interest in the housing market this month, but these developments are likely to have been overshadowed by concerns stemming from the turmoil in financial markets.”
In many respects, the government is trying to help first-time buyers with gestures such as a 0 band on stamp duty which means for the time being homes purchased below £175,000 are exempt from paying stamp duty tax. However, without a sizable deposit, excellent credit history, and affordable house prices, many first-time buyers are either forced, or choosing, to rent as the property market is still expected to drop in the near future.
Thu, Sep 25, 2008
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