There needs to be more balance, between the advice being provided by modern-day estate agents to vendors, and the advice needed by those wanting to buy in difficult market conditions. With the old maxim, Caveat Emptor (Let the buyer beware) still ruling in UK house buying it’s becoming increasingly vital for ‘buyers’ to get the best possible advice when finding their next house or big mistakes can easily be made. It’s vital to negotiate the most appropriate terms for purchasing any property these days. For this reason we are calling for a completely new breed of agents which we call ‘Finding Agents’ to replace all the existing selling agents right across Britain.
The need for this is demonstrated by considering the following 10 aspects of the present-day housing market, all of which need addressing urgently.
1. The need to BUILD MORE HOMES. Most of us agree that orchestrating the building of more homes would be beneficial in the medium / longer term but doing so must take time. Unfortunately the attempt to stimulate more building using the so-called ‘Help to Buy’ schemes is causing confusion because these schemes are really “Help To Sell”. When you think about it their real aim is to assist ‘sellers’ to obtain the best price, instead of helping buyers to get a fair deal. Those who still think otherwise are naive.
2. BUILDING MORE GARDEN CITIES. Whilst not a bad idea in itself, this is not going to be nearly enough to deal with the problems we’re facing on its own.
3. STAMP DUTY. This should certainly be looked at but with a view to lowering the tax as soon possible, in order to bring more buyers into the market. However, once again, doing this won’t deal with all the problems on its own.
4. LEVYING CGT ON ALL HOUSE SALES. The idea of not levying CGT on owner-occupied homes was originally to encourage more people to become owner occupiers. With the number of buyers actually in decline currently (that is with the uptake in home ownership at its lowest level in 25 years), why suddenly impose CGT on house sales? No useful purpose whatsoever would be served by doing this.
5. TAX FOREIGN INVESTORS? Doing that would probably not be seen as being very European.
6. LEVYING AN ANNUAL PROPERTY TAX. Trying to levy increased taxes on house ownership, in an attempt to curtail price increases is like trying to use a lever to change the orbit of the planet!
All very well in theory but not in practice. The problem with this approach is that it simply doesn’t address the fundamental issue - which is the need to bring the market back to equilibrium and stability, with prices broadly inline with average levels of wealth.
7. TAXING LANDLORDS MORE. This is simply not an option since we desperately need more (good) landlords. Making life more difficult for them to acquire rental property would be a totally unproductive measure as this sector is a vital part of supporting the fragile housing economy.
8. RESTRICT MORTGAGE LENDING. By contrast this is undoubtedly a yes and is so important. Not managing how much individuals can borrow when deciding to buy owner-occupier property is the equivalent to usury gone mad. It simply hands the cosh to the financial institutions - and we all know what damage that can do having witnessed the recent banking collapse. Sensible restrictions are, and always were absolutely paramount in this area. That’s one of the main and ongoing responsibilities of a diligent government . One that is perhaps not being pursued enough at present, certainly in some people’s view.
9. BETTER UTILISE EXISTING EMPTY PROPERTIES. Taxing the owners of empty flats and houses does seem to be a necessary and worthwhile idea in order to maximise the use of our existing housing stock.
10. THE MISSING OVERRIDING SOLUTION. The one measure that is missing from all of the above is concerning the old established maxim: Caveat Emptor - which is where we came in. This maxim has served the UK housing market well for many decades now but it seems to be in need of some attention. Owing to the problems we have recently been facing it’s becoming increasingly vital for all ‘buyers’ to get the fullest advice whilst finding their next house and to negotiate the most appropriate terms for purchasing it too.
That’s why we see the need for ‘Finding Agents‘ to completely replace selling agents. Estate agency desperately needs revolutionising these days and this is the only sensible way this could be achieved.
For more about HOW these changes could swiftly be implemented, please see: -
We want a functional, stable housing market.
Posted by: Peter Hendry, Consultant in Housing Valuation at Property Match (UK)