What does the 2015 General Election mean for the property market?

Wake Smith Solicitors 28 April 2015

The 2015 General Election is just few days away.  The main parties have now set out their manifestos.  Whilst the media tells us to expect another hung parliament, it is still useful to know what each party is planning.  Although it is difficult to gauge what impact the housing policies could have on the property market in Sheffield and the City region here are some thoughts.  The Coalition Government introduced a progressive new regime for calculating the stamp duty land tax payable on the purchase of residential properties in December 2014. These changes have meant that less stamp duty land tax is payable in 98% of residential property transactions. There are signs now that this helping the market. All of the main parties would like to bring further changes however both to assist the market and to address the issue that many people, particularly younger people, find it difficult to get onto the property ladder. The Conservatives would look to build 200,000 starter homes for first-time buyers alongside extending the Help to Buy scheme. This would be good news for first-time buyers in our region assuming that a rateable proportion of the homes were built in our region. Labour's plans envisage a massive increase in house- building. They are aiming to have 200,000 new homes built a year until 2020. Great news for new home buyers but even better news for the construction industry. Alongside this policy Labour would introduce a mansion tax for properties worth more than £2m, whereby such properties would face an annual charge as well as a substantial stamp duty land tax charge. Unfortunately this would not affect many properties in our area.   A Labour government would also exempt first-time buyers in England, Wales and Northern Ireland from paying stamp duty when buying homes below £300,000, for three years. The Liberal Democrats would take the house building even further than Labour, by proposing that 300,000 new homes are built per year by 2020. They would also look to introduce 10 new Garden Cities; however it does not currently appear that any of these would be in our area. UKIP have pledged to remove stamp duty land tax on the first £250,000 for new homes built on previously developed land. The Green Party meanwhile wishes to abolish the Right to Buy scheme for council properties, seeking to preserve them for the purpose they were intended. It is therefore common ground that all the parties wish to see more houses built, so can we assume that it will happen? Given that most of the volume house-building carried out in South Yorkshire takes place around Doncaster and Barnsley, and Sheffield lags behind even the current modest targets it will be interesting to see what planning law changes are proposed, and in particular for Sheffield local authority, what sanctions there will be against authorities who build less than their quota. If you would like any further information please do not hesitate to contact Tom Weightman on 0114 266 6660 or email [email protected].

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