18th May 2012

First time buyers – key to property market

Apologies for the lack of blogs over the last few weeks.  This has been brought about by an unprecedented surge in activity in the Scottish property market in general and my business in particular.  This is a good sign, however, there are some interesting and perhaps worrying trends developing which I will report on over the next few weeks.  I read the report yesterday from Your Move indicating a massive surge in first time buyers prior to the end of Stamp Duty Relief.  I have to report that this is not my experience and I am becoming more and more concerned regarding the lack of first time buyers in the market.  I have not seen any official statistics but my own view is that lack of mortgage finance is severely curtailing first time buyer activity.  The Government’s New Buy Scheme launched in England to assist first time buyers purchasing new properties has failed to have any impact.  I would urge the Government to bring in a scheme to assist first time buyers who are looking to buy any property in the UK market.  This would release the property market, boost the construction industry, boost retail and have a huge positive impact on the UK economy.  This could be funded by tightening up the Capital Gains Tax Rules so that you have to be in your property for a certain period of time before you can sell it without incurring any Capital Gains Tax, i.e. if you live in a house for more than five years it can be classed as your sole or main residence, if you sell it prior to five years you then have to pay a percentage of the gain depending on how long you have lived in the property.  As well as funding any assistance to first time buyers this would also have the positive impact of curtailing property speculation.

I will report further on the property market soon.

Lindsay Darroch
Partner and Head of Property

 

 

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