Remove Stamp Duty for older people in mid-priced homes – MPs
Writing in its November News and Views publication, the Council of Mortgage Lenders noted that members of the all-party Parliamentary Group on Housing and Care for Older People argues many older people occupy homes that are too large, difficult to maintain and expensive to run.
It believes encouraging older people to move into the right-sized accommodation for their needs would make more homes available for younger, growing families.
In September the CML, in its manifesto, ‘A housing market to be proud of’, called for political parties to help young buyers by recognising the shift toward shared-ownership as a permanent tenure and reforming the Stamp Duty system.
MPs are recommending removal of the 1% stamp duty band, applied to homes worth between £125,000 and £250,000, for older homeowners looking to move.
The MPs’ report, The Affordability of Retirement Housing, in association with the DEMOS think tank, concluded: “To fill the affordability gap for those with lower value properties, greater use could be made of financial instruments like shared ownership; but these present problems for most house-builders and it is the housing associations who could and should expand the market using these tools (and can offer the homes for rent if there is a downturn in the market).”
It also concludes: “Transaction costs of moving could be reduced through Stamp Duty exemption for older movers in low value properties: this would create a net gain to the Treasury thanks to the subsequent moves this would generate.”
The report added around eight million people aged over 60, in seven million homes, are interested in ‘down-sizing.’
If half did so, 3.5m homes would become available.
However, the report identifies a shortage of homes built specifically for older people, with around 8,000 a year built today, compared to some 30,000 annually in the 1980s.