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How to solve the UK’s housing crisis

Posted 13th April 2023 by sdlt-admin

Have you purchased UK property that you paid Stamp Duty Land Tax on? See if you are eligible for a refund from HMRC on overpaid SDLT

Read the article on English Living

“The UK housing market is currently facing an overwhelming supply and demand imbalance. The National Housing Federation estimates that 340,000 new homes must be built annually to meet the current demand as the past pledges of 300,000 new homes being built each year by the mid-2020s have fallen short. In light of this, Group Chairman of leading property experts, Cornerstone Tax, David Hannah, discusses why the issues of Britain’s housing market have become a significant factor in the next general election.

Read: How much stamp duty do I pay on a second home?

The lack of housing supply in the UK results from two decades of failed pledges from previous governments. According to the government’s Affordable Homes Programme, 9,000 fewer houses were built in 2016 than planned. By 2021, government figures show that this has increased to 32,000 homes. As a result, nearly half of England’s local authorities have not built enough homes to keep in line with population growth since 2011. The average price of a home in the UK has almost doubled since 2009, according to the Office for National Statistics – rising by around twice the rate of inflation, with London and the South of England seeing the fastest growth.

Britain’s chronic lack of supply is affecting the rental market too. According to the ONS, the averages private renter now spends more than a quarter of their income on housing costs. The reason for the high costs of rent, Hannah believes that the government changing its building pledges, coupled with the increase in government red tape on rental properties, has caused a mass exodus of landlords from the rental market – a time when landlords could offer the government welcomed relief in providing homes for its citizens.

David Hannah, Group Chairman at Cornerstone Tax, discusses:

“We are currently experiencing a chronic undersupply of housing in the UK due to the failed promises year on year by government’s past and present to build new homes. A continuation of this will mean that housing will become even more unaffordable. This comes amidst the fluctuation of mortgage rates, and now, first-time buyers will need help finding an available property they can afford.

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“We have now reached a point where the market is so strained from lack of stock – those renting or looking to rent are entering a highly competitive market, as many are willing to compete and outbid on rent prices.

“In the run-up to the next general election, I expect the question of how Labour and the Tories will go about overhauling Britain’s housing market will play a large factor in influencing whom the public will vote for. We need a clear and concise plan to benefit everyone across the housing market”.

Have you purchased UK property that you paid Stamp Duty Land Tax on? See if you are eligible for a refund from HMRC on overpaid SDLT

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