Labour's aim is to give first time buyers complete relief from
stamp duty on lower threshold properties, those worth between £125,000 and £300,000.
I bought my house for a measly £70,000. So this cap wouldn’t have helped me,
but would their ideas on housing really help other young families looking to
find a place of their own? The average house price for first time buyers is around
£175,000 which is considerably higher than the current stamp duty threshold,
about 50 grand higher. Labour says the
new policy will benefit nine in 10 such buyers and to the tune of £5,000. Great electioneering but an utter fallacy.
By my eye it would save approximately two and a half grand
for each ‘first timer’ at the low end of the threshold (£125,000) and is most
likely by my calculations to save approximately three and a half grand for most.
The number quoted above for average first time buyer property prices, takes the
booming London property market into account. The Office for National Statistics
reported that in February, where the average property price throughout the UK
was £270,000 the average without consideration paid to London and the south
east was £207,000. Now obviously this is speculative but it would be reasonable
to assume by extrapolation that, beyond London and the South East, based on
these figures, this Labour policy will affect less first time buyers than they
suggest. 9 in 10 says Ed.
How the measure will be paid for also runs contrary to Ed’s ‘everything
is fully costed’ message. Shadow Housing Minister Emma Reynolds confirmed today
that this would be paid for from clamping down on tax avoidance. Not just any
old tax avoidance though, tax avoidance perpetrated buy landlords themselves.
Specific enough? Not really.
Anyway, whether or not the Shadow Minister spelled out in
detail the method by which this tax would be reclaimed is ‘by the by.’ This policy
seems to be a 'crowd pleaser' amongst voters and that is all this is. Every
expert organisation is yelling out for more house building as the answer to the
Nation’s housing crisis and there has yet to be a commitment to capital
expenditure of this sort from either of the main proponents. The Royal
Institute of Chartered said last week that Labour's current housing policy was “ill
thought through.” If they are elected only time will tell.