There is no doubt that the Brexit vote rocked the financial sector and caused huge amounts of uncertainty and panic in the property industry. Money was pulled from commercial property funds, shares in house-builders dropped dramatically overnight, economists began to forecast a mild recession and there were warnings that house prices would slide.
However, almost three weeks on, the situation has calmed somewhat and the sale of houses does not seem to have slowed down quite as much as initially anticipated. Perhaps this is a result of imminent interest rate cuts or simply because leaving the EU did nothing to relieve our immediate housing shortage - There are many reasons why house prices might not slide.
It was recently reported that major house builders, including Barratt, Persimmon, Bellway and Redrow have begun to lobby the government for an extension of the Help-to-Buy scheme, which currently provides qualifying buyers with an equity loan worth 20% of the house purchase price. Housebuilders are calling for this to be increased to 30%, arguing that this would ensure the protection of jobs and output of new homes continues in the face of a slowing economy.
They are clearly not alone in their thinking as the Intermediary Mortgage Lenders Association (IMLA) have also been calling for the government to extend the scheme, and have also been critical of housing policy “claiming that ministers have resigned themselves to only addressing the demand side of the market and are not doing enough to stimulate supply.”
We would be interested to hear what you think. Would an extension of the Help-to-buy scheme provide more security to the housing and planning industry in the current political and economic uncertainty?