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The Stoke-on-Trent Property Blog
Tuesday 10 December 2019
Thursday 28 November 2019
Mending the Broken Stoke-on-Trent Property Market
The long-lasting issue of the Stoke-on-Trent property market
are laid bare as the final 2018 property transaction figures have just been
published and they continue the post credit crunch trend of less people moving.
42.3% less of Stoke-on-Trent people are selling their
homes annually since the credit crunch, when compared to the post Millennium
years of 2000 to 2005
This is not just an issue of the Stoke-on-Trent housing market slowing down since the credit crunch - the challenge is to split out shorter-term factors such as Brexit and the elections from longer-term structural issues of the UK society, because when these most recent property transaction figures are seen against longer-term trends for Stoke-on-Trent, they suggest more significant issues in the Stoke-on-Trent housing market.
So, whilst there was a recovery from 2013 onwards, it was
rather uninspiring when compared to the pre-credit crunch years, with a lacklustre
performance in property transactions since mid 2010’s.
You might ask why we should be concerned about the
number of property transactions and not the change in property values?
The number of transaction numbers are a far more exact
bellwether for the health and potency of the local housing market.
As less people have been selling their homes locally, this
is not only bad for the Stoke-on-Trent housing market but for the economy
locally, especially when you consider how many allied businesses (builders,
decorators, solicitors, removal vans, estate agents, mortgage arrangers and other
people) lose out as a result.
Some say the deficiency of supply of property, mainly
affordable first-time buyer property, is the chief reason why transaction
figures remain stubbornly low. Others suggest the absence of suitable housing
stock up the property ladder (particularly bungalows for the older generation),
combined with rising demand, is causing a bottleneck in our local housing
market.
I know there has been much talk from Westminster about grand
home-building programmes, yet we now require them to deliver on these undertakings
and even then, it will be a few decades before we see a seismic change in the Stoke-on-Trent
property market.
In the short-term, a quicker improvement may come from modifications
to stamp duty. First time buyers don’t need to pay Stamp Duty up to a certain level,
yet those Stamp Duty concessions could be extended to those mature homeowners looking
to downsize. This could liberate a meaningful number of mature family homes
occupied principally by these mature generation and the tax lost through Stamp Duty
could be replenished by a revaluation of the Council Tax bands?
Council Tax bandings were set in 1991 and the seven bands,
the highest band starts at £320,000 (based on 1991 values). It seems irrational
to us that upper value band, set in the 1991 revaluations, has not been
increased, particularly as house prices in London have risen by over 400 per
cent during in the last 25 years.
That would mean higher tax for those who don’t move yet less
tax for those that do move - because we believe it would boost a far more liquid
Stoke-on-Trent property market.
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