Stamp Duty Cuts for the elderly could free up family homes
The hornets’ nest, that Boris Johnson kicked up earlier this week, is raging on with many speculating on how to best improve the flow of housemovers.
Once again the issue of stamp duty relief was high on the agenda with Lord Best, a member of the All Party Parliamentary Group on Housing and Care for Older People, of the opinion that the abolishment of stamp duty for elderly people looking to downsize will encourage movement, creating a greater stock of family homes for those that need it.
Lord Best, Cross-bencher and a member of the All Party Parliamentary Group on Housing and Care for Older People, has commented: “The Treasury gets more money because there is a chain of people who also move and have to pay stamp duty. I think they might buy it, it is a nice easy one for them. You get two-and-a-half moves as well as the older person’s move, on average, and you work out the gain, which is more than the loss.
“If you are down-sizing you are probably going to take some cash out of the deal, so you are going to buy somewhere worth less than the place you are selling. They are not getting any stamp duty from you buying the cheaper place, but the person buying your place, which is more valuable, you get the full stamp duty on that. If you don’t move and just rattle around there, they never would have got that.”
“If you get in a helicopter over Harrogate all the housing is three-bedroom housing with gardens, though there are some small blocks of flats. If you take your helicopter and keep going to Penzance, England is three-bedroom houses, a lot of these occupied by two or one person … That is OK when they are 65, not so good when they are 75 and hopeless when they are 85.”
These comments also follow the recent statistics published by Lloyds Banking Group which stated that the 177,000 home movers from the first half of 2018 was down 1% compared with the same period last year and down by 33,000 (16%) from the second half of 2017.
Andrew Mason, Mortgage Products Director of Lloyds Bank, said: “Despite continuing low mortgage rates, the homemover market has stabilised with little movement in the first half of this year to leave first-time buyers now driving housing activity.
“This may be in part due to the Help to Buy scheme enabling first-time buyers to purchase a new property, combined with the low availability of the ‘right type’ of homes for those looking to move up the housing ladder. The costs of moving house and potential further interest rate rises may also be weighing on potential homebuyers’ minds.”
The idea of protecting the interests of those looking to downsize and create the right type of property for families in need, could be a popular idea as the government continues to find ways of supplying the housing demands of Britain.
Would a pensioner exemption of Stamp Duty encourage more people to downsize and free up the property?