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Housing groups have said the recent stamp duty cut will boost the number of prospective buyers purchasing shared ownership properties and allow them to buy up greater shares of their homes.
Chancellor Rishi Sunak announced last week that the government is temporarily raising the stamp duty threshold from £125,000 to £500,000 in a bid to stimulate the housing market.
A number of housing associations have said that the policy – expected to cost around £3.8bn – is good news for those looking to buy houses at the lower end of the market.
Jonathan Layzell, executive director of development at 32,500-home Stonewater, said: “The stamp duty holiday is a welcome move which is likely to boost a flagging housing market and give people more confidence to buy.
“Most of our shared ownership customers are first-time buyers, but a further stamp duty holiday will provide extra help and will support those looking to ‘staircase’ to purchase an increased share of their home.”
The temporary cut, which applies to England and Northern Ireland, will run until 31 March 2021 and see the average stamp duty bill fall by £4,500, according to Mr Sunak.
Paul Gerrard, director of ForLiving, which is part of the ForViva group, said the cut could be a “real positive” for the housing market following disruption brought by the COVID-19 pandemic.
He said: “The lower end of the market, where shared ownership purchasers primarily sit, is where the benefit will be felt most.
“Share ownership offers people who may not otherwise have the opportunity the chance to get onto the property ladder, so the announcement will be a very welcome boost for them.”
Jane Gallifent, development and sales director at Aster Group, said the cut is a “vital step” to re-energise the market, which was effectively frozen between March and May.
“It’s encouraging news for shared ownership buyers, particularly those in expensive areas of the country where properties valued below the previous cut-off are often hard to come by,” she added.
But Catherine Ryder, director of policy and research at the National Housing Federation, warned the move will help restart some parts of the private housing market but it will not make buying a home affordable for many.
Ms Ryder noted that housing associations have seen increased interest in shared ownership during lockdown as potential first-time buyers think about the affordable housing options that are available to them.
However, she said: “Ultimately, research shows that regardless of extra incentives, the private market alone cannot build all the homes needed to meet demand. That’s why the best long-term solution is for the government to invest in grant to build more social homes.”