ROOF Blog

Young people trying to get on the property ladder were handed a pre-election boost worth up to £2,500 after the chancellor scrapped stamp duty on homes costing £250,000 or less for first-time buyers. The move will be funded by an increase to 5% in the duty on homes costing £1m or more, which will see buyers of these properties having to hand over a minimum of £50,000 in tax. The move was quickly dubbed by some as a ‘Robin Hood’ tax on the rich. The new £250,000 threshold, which took effect at midnight last night and will last for two years, means nine out of 10 people buying their first home will not be liable for the tax.

The UK industry should develop more products to help builders and property owners make the 5.5 million properties at flood risk in England and Wales more resistant and resilient to flooding, Environment Agency chairman Lord Chris Smith says. Speaking at the National Flood Forum annual conference, Lord Smith also encouraged building merchants and DIY stores to offer advice to builders and members of the public on how to make properties more resilient to floods, so that drying out and cleaning up is faster and cheaper following any flooding. A recent Environment Agency study into the devastating floods of summer 2007 found the average cost per flooded home was between £23,000 and £30,000 and a quarter of homeowners were not fully covered by insurance.

Gross mortgage lending in January fell to the lowest level in 10 years as buyers were deterred by the end of the stamp duty holiday, figures showed this week – but experts have warned that lending could decline further as banks lose government funding support. According to the Council of Mortgage Lenders (CML), gross mortgages totalled just £9.1bn in January, down 32 per cent from the £13.4bn in December. This is the lowest monthly total since February 2000, when gross lending was £7.9bn. While a seasonal fall is usual between December and January, the CML said the drop was ‘larger than average’ due to higher purchase activity in December, as borrowers rushed to take advantage of the stamp duty holiday on properties valued less than £175,000.

The monthly Halifax house price index shows that house prices jumped by a bigger than expected 1.4 per cent in November, spurred on by higher demand and a shortage of properties for sale.

The increase was the fifth successive monthly rise with prices more than four per cent higher over the first 11 months of the year. The average cost of a house in the UK is now £167,664.

However, that is still 1.6 per cent cheaper than this time last year, and the recovery in house prices that we’ve seen in the past six months is unlikely to be sustained next year, analysts warned.

Seema Shah, a property economist at Capital Economics, said: ‘With the economic recovery likely to be lacklustre, unemployment set to rise and household incomes likely to be under downward pressure from pay freezes, house price falls remain the most likely outcome next year.’

More than 900,000 homes and businesses in England and Wales could be at the highest risk of flooding by 2035 without increasing investment in defences, the Environment Agency has warned.

The agency said the number of properties at the highest risk of inundation could rise by 60 per cent from current figures of 560,000, as it outlined a new five-year strategy, including plans to protect an extra 200,000 homes and businesses from flood waters.

The agency said that in the past five years, 156,000 properties had been protected against flooding.

Chief executive Paul Leinster said: ‘Less waste is going to landfill, more properties are protected against flooding, pollution incidents have halved since 2000 and there are more fish and wildlife in lakes and rivers.’

But he warned: ‘Climate change is already affecting the UK and the challenges we face as a result are only going to get tougher and more properties could be at increased flood risk.’

Crisis, the charity for homeless people, is launching a campaign to resist unpopular plans by the government to ask housing benefit claimants to pay back up to £15 a week they are allowed to keep if they negotiate cheap housing deals.

The Department for Work and Pensions had planned to end this after calculations showed it could bring in £160m.

For some of the least well-off, the change could amount to £15 a week, reducing by a fifth the cash in hand of someone receiving jobseeker’s allowance of £69 and leave some of the poorest families across the country some £780 worse off over the year.

Leslie Morphy, Crisis chief executive, called on the government to reconsider, saying: ‘This proposal would have a grave impact on some of the poorest households.

‘It’s not even likely to make the savings the government hopes, because claimants will no longer have an incentive to seek cheaper properties and landlords may simply raise rents to meet the maximum local authority level.

‘For people who are already struggling to make ends meet, losing a huge chunk of their income will make it even harder to get by and we are worried that this could lead to an increase in debt, rent arrears and homelessness.’