From Robert Ulph on March 15, 2021
At the start of the year, HM Treasury invited interest groups, individuals and representative bodies to comment on government policy and to suggest new policies for inclusion in the Budget.
Propertymark submitted new policy ideas for the housing market, however following the budget last week they will continue to lobby as they believe more should be done to tackle COVID-related rent arrears.
There were six key areas that Propertymark focused on to support the sector:
• Provide a financial support package for the private rented sector.
• Raise local housing allowance.
• Ensure universal credit is adequate and more effective.
• Reopen courts to deal with the backlog of housing cases.
• Support investment in the private rented sector (PRS).
• Build more social housing.
In addition, they have worked closely with other organisations calling for a targeted financial package to help renters pay off arrears built since lockdown measures started almost a year ago. This will help to sustain existing tenancies and keep renters in their homes – whilst also ensuring rental debt does not risk them finding homes in the future.
Even though an extension to the increase in Universal Credit was announced, Propertymark believes that this does not tackle the fundamental issues which means the system is inadequate and ineffective for both tenants and landlords in the PRS. They believe that tenants should have choice over whether the housing element of their Universal Credit is paid direct to their landlord, give an optional for fortnightly payments and to tackle rent arrears the Universal Credit advance should be turned into a non-repayable grant. Through these changes Universal Credit can provide more flexibility and better reflect the reality of claimants’ lives, particularly those on low incomes and better support tenancies in the PRS.
Propertymark did welcome the extension to the Stamp Duty Land Tax relief and see this as great news for the industry. Propertymark and its members had collectively lobbied to avoid a ‘cliff edge’ leading thousands of sales to fall through and it appears that campaign has been a success. Now the nil rate band up to £500,000 will end on 30 June, instead of March and a transitional nil rate band up to £250,000 will be in place until September and then return to £125,000 from October.
Furthermore, a new mortgage guarantee scheme in April 2021 will provide a guarantee to lenders across the UK who offer mortgages to people with a deposit of just 5% on homes with a value of up to £600,000.
Propertymark acknowledges where there has been support, but as Timothy Douglas, Policy and Campaigns Manager stated, “there is a real need for the UK Government to ensure a wider package of measures to help tenants and landlords keep the rent flowing.”
I will continue to work with Propertymark in their work and I will keep you updated with progress and policy changes. As always, if you have any questions on these issues or anything in the local property market, please call me.