The NAEA has warned the Chancellor of its fears of a double-dip recession. It has called on the Government to take immediate and decisive action to stave this off.
In a hard-hitting message to Alistair Darling ahead of his Autumn Budget Statement on December 9, the NAEA says: “We call on the Government to take action to stimulate housing sales, as we fear that the current recovery is in danger of stalling, producing a so-called W-shaped recession.”
The NAEA has issued a series of demands.
It wants the Government to suspend HIPs, saying their cost is punishing sellers whilst being of almost no interest to buyers.
It also wants the Government to actively encourage lenders to give high loan-to-value mortgages to first-time buyers.
It asks the Government to consider copying the US, where first-time buyers are being given a tax credit of ,500 worth £4,000. This has given a real boost to their new-homes market.
The NAEA is also calling on the Government to extend the current Stamp Duty holiday and to re-examine the entire Stamp Duty regime with a view to reform.
Its sister organisation ARLA is also urging action. It wants incentives introduced for landlords to improve older housing stock, including the removal of VAT on materials and labour. It also wants the Landlords Energy Saving Allowance to include the installation of central heating.
In their submission to the Chancellor, the NAEA and ARLA say: “There is a continuing threat of a downward spiral in house prices, falling mortgage availability and a longer-lasting depressed market.
“It is imperative that, now the market is starting to recover, further measures are put in place to ensure that we do not experience a W-shaped recession due to the upturn being unsustainable.
“A key factor will be ensuring access to mortgage finance for buyers looking to enter the market.”
The NAEA says its members are reporting an average of 294 applicants per branch, but that these are translating into only eight or nine sales each month. It says that with lenders wanting deposits of between 25–40%, more and more people are being priced out of home ownership.
It adds that landlords are also finding it difficult to access mortgage finance at a time when new rental accommodation is badly needed. This item read :: 747 times
