Housing experts have called on Rishi Sunak to reform stamp duty in order to boost transaction volumes and provide more help for first-time buyers in his first Budget speech as chancellor.

Setting out their hopes and fears ahead of Wednesday’s announcements, industry commentators have warned that the government must bring forward policies to stimulate the market as fears around the spread of Coronavirus start to weigh on investors’ confidence.

Help for first-time buyers

The chancellor is likely to use his speech on Wednesday to provide more detail on plans to offer 30 per cent discounts to first-time buyers purchasing homes in their local area, experts predict.

Industry figures have been calling on the government to provide more first-time buyer incentives to prevent a drop-off in activity when the Help to Buy scheme is scaled back.

Wayhome chief operating officer Nigel Purves says: “Supporting aspiring homeowners has never been more important, and it’s in the government’s interest to make a meaningful difference. 

“Innovation will be central to this and needs to be adopted to provide credible, affordable routes to homeownership.”

North London estate agent and former Royal Institution of Chartered Surveyors residential chairman Jeremy Leaf agrees.

He says: “The most important message for the chancellor as far as the housing market is concerned is: do nothing to compromise the already relatively low-level of transactions and as much as you can to increase them, particularly for first-time buyers.”

Nested head of valuations Henry Verrill says: “The Queen’s Speech, announced that the government would ‘take steps to support homeownership, including by making homes available at a discount for local first-time buyers’.

“Detail on this at the moment is scarce but this might form part of a compelling giveaway for first time buyers.”

Stamp duty overhaul

Speculation over stamp duty reforms is always rife in the build up to Budget day and this year is no exception.

There have been rumours that ministers are considering a surcharge for foreign buyers, while other commentators have expressed hope that the chancellor might look to reduce the hated tax for home movers and downsizers.

Leaf says: “Stamp duty has become a deterrent for many, especially at the top end of the market, which is stopping activity from the bottom to the top of chains. 

“But whatever you do, please do not announce a consultation as this will only freeze up activity for its duration and lead to even more indecision until the outcome is known.

“More transactions are not just good for the property market but great news for the economy as a whole in terms of jobs and social mobility.”

Verrill adds: “It is quite possible that the chancellor will cut the rates of stamp duty to help boost the housing market – perhaps at the lower end to help first-time buyers.

“This has regularly been cited by industry professionals as one of the main obstacles holding the market back, but we expect that foreign nationals and second home owners will continue to be penalised as part of Boris’s pitch to level up.”

Boost housing supply

The affordability problems facing home buyers and movers are unlikely to be resolved until there is a significant boost to housing supply, experts frequently claim.

Many hope to hear further measures to this end announced on Wednesday.

Verrill says: “We would also expect to see some technical measures to release land for house building and to help local authorities and housing associations fund more building schemes. 

“This could form a part of the expected major infrastructure project package to be announced. 

“Boris likes to build things – this was a key focus in his time as Mayor of London.”

Leaf adds: “On the supply side, more house building in high-demand areas, aimed specifically at the social and affordable end, is a must. 

“This should be complemented by planning which is less mired in red tape and infrastructure delays, resulting in earlier delivery.”

Mortgage prisoners

The chancellor should use his speech to take urgent action in support of  mortgage prisoners, the campaign group for those affected has argued.

Lead campaigner Rachel Neale says many prisoners are now at crisis point, relying on foodbanks and facing the loss of their homes with severe mental health consequences.

In an open letter directly addressing the government she says: “I urge you to stop talking and stop waiting. 

“Please stop using red tape on legislation as an excuse for inaction, and put the effort and willingness in to finding real solutions. 

“Without question, your government has had value for money out of the mortgage prisoner situation – to the tune of £5bn (a nice bit of profitable business, I’d say, but at the expense of us), but this now has to stop.

“Stop selling our mortgages to vultures and sort the mess out which you have actively allowed to continue.”