How government can lay foundations for market improvement
when marketing commences, so let’s follow the lead of our more relaxed European cousins.
In France, Portugal and other countries, the certificate is required only when terms for purchase are agreed.
Until this change is made, the abolition of the HIP only goes half-way to encouraging more speculative vendors into the market and minimising wasted consumer expenditure.
Streamline the provision of information
The HIP was flawed from the outset, but it did at least concentrate attention on the need to speed up the process of collating papers and searches prior to sale. The new Government should contrast the speed and efficiency of the provision of information from the utilities and other agencies, with the slower and more cumbersome process of completing local authority searches and confirming planning issues.
Create a transparent conveyancing process
The Land Registry is slowly making progress in its e-conveyancing plans.
The third consultation on its proposals would be a perfect opportunity to provide additional support and encouragement for this initiative. The ability for agents, solicitors, buyers and sellers to view the progress of their chain in a transparent way online should remove a considerable amount of the frustration caused by the lack of information provided during the purchase process.
Licence estate and lettings agents.
With the proliferation of consumer protection legislation covering the estate agency process, the Property Misdescriptions Act and Money Laundering Regulations among others, the introduction of a formal licensing system for estate agents would ensure that their consumer protection role is enhanced and promoted, and would be a positive step towards increasing consumer confidence.
Encourage the building of homes people actually want to live in.
If we are going to retain housing targets, and it seems likely that they will survive in some form, make sure they are based on the amount of accommodation provided (bedroom counts or floor area) not on numbers of units. This will mean that local authorities are encouraged to approve development for the type of housing needed by families in the UK rather than ticking boxes in order to fulfil a meaningless central diktat. Reform unhelpful taxes The Lib-Dem proposal for equalising VAT for new-build and for refurbishment was an obvious non-starter. But how about levelling down the other way – to zero?
With most “green” policy initiatives aimed at new-build developments, the removal of VAT on the refurbishment and renovation of our existing housing stock would be a significant step forward, particularly when we come to think about retrofitting green technologies into older homes.
And while you’re at it, why not reform the current slab structure of Stamp Duty, which sends tax bills soaring just because a house buyer spends an extra £1 over one of the £250,000, £500,000 and (from next April) £1m thresholds. The current system distorts the market, discourages liquidity and damages labour market flexibility.
It seems likely that it is too late to change the decision over the new high CGT rates, but we would say that an effort must be made to a recognise the difference between short-term and longer-term capital gains on investments, with an indexation allowance at the very least and ideally a revived taper relief structure.
Tim Waring is Knight Frank’s head of residential in the North of England.
FREEHOLD: Garforth House on Micklegate in York.