Today Mr Osborne delivered his last budget before the general election in May. The drop in inflation rates to a record low mean Mr Osborne or his successor will have around an additional £6 billion in the kitty.
Promising not to return to the “chaos of the past” Mr Osborne claimed “Britain is working again” and that “this budget backs the homebuyer.” But just how exactly was he going to do this?
He skated briefly over talk of new funding for the London Land Commission to help address the shortage of house in the UK, as well as the mention of “housing zones”, although he refrained to elaborate any further. Claiming that they “won’t build the country up by pulling London down” suggests we could see a close in the gap between house prices in both halves of the country.
However Mr Osborne’s big hitter was the announcement of a new Help to Buy ISA for first time buyers. The scheme will help those aspiring to get a foot on the property ladder by paying an additional £50 to their deposit for every £200 they save themselves. Effectively a tax cut for first time buyers it will be introduced in the autumn. This coupled with the news that inflation rates will remain low will be welcomed by those struggling to afford to get onto the housing ladder.
Founder and CEO of eMoov.co.uk and Brentwood Councillor, Russell Quirk, commented
“George Osborne has dug deep for aspirational home owners by throwing them a bone of a 25p bonus for every £1 they save, via a new “Help to Buy ISA”. The result for the aspirational home owner is having saved a deposit of £12,000, George will add an additional £3,000 to the deposit for your first home.
Will this boost the property market? I think it will due to a combination of things. Interest rates that given long term inflation forecasts are set to stay low, the November’s Stamp Duty boost and today’s 25% First Time Buyer ISA bonus, will all help to contribute. All in all things are certainly looking buoyant for the UK housing market.”
Full details on the Help to Buy ISA can be found at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/414027/FTB_factographic_final.pdf