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Families are being forced out of the capital as figures show there are no houses for sale in Central London with a garden costing less than £500,000, it has been claimed.
It is the latest evidence of the struggle families in London face to find an affordable home.
Soaring property prices mean many families have been priced out of the capital and are forced to move further afield, spending hours commuting to work every week.
Zoopla shows less than 20 residential properties listed for sale in Central London in this price bracket with a garden. All of the properties are flats and a garden is defined as a balcony or patio rather than a lawn area.
It compares to an average increase of property values in England of almost £16,000 to £256,975.
Cheaper and more spacious property is available in outer London. But families’ options are still limited, with fewer than 900 homes for sale in all of London having a garden and costing less than £250,000.
Zoopla shows a total of 890 houses listed for sale in London that have a garden and are under the £250,000 Stamp Duty threshold – where buyers must pay 1 per cent of the price in tax. The thresholds jump significantly above £250,001, starting at 3 per cent and rising to 7 per cent for those properties costing more than £2m.
The majority of these homes are terraced properties, with just 10 being detached.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “While rising house prices are welcomed by homeowners, much of the increase in prices is due to the serious lack of housing stock on the market.
“This is particularly true towards the bottom rung of the ladder where there are precious few family homes with gardens coming up for sale costing less than £250,000.
“Families are being forced to buy further and further afield in order to get a reasonably-sized home with a garden at an affordable price.”
London properties for sale with a garden for £250,000:
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Chancellor George Osborne is determined to ‘avoid the mistakes’ of the last decade and ‘keep Britain moving’.
At the heart of his housing policy announced in the Autumn Statement is building more homes.
He said: “Some of the most important infrastructure for British families is housing and we have to confront this simple truth: if we want more people to own a home, we have to build more homes.”
He also announced £1bn of loans to unblock large housing developments on sites around the country and confirmed that lenders Aldermore and Virgin are set to join the Help to Buy Scheme. The Help to Buy Scheme was introduced earlier this year to help those with a small deposit to buy a home.
“I can announce today that Aldermore and Virgin, two challenger banks, expect to join the scheme this month. Help to aspiring families and building more homes – that’s what we stand for,” said Osborne.
But he added a word of caution, saying: “We must also avoid the mistakes of the last decade.
“We want a responsible recovery….We want a functioning, stable housing market.”
Other items included:
- Regenerating some of the most run down urban housing estates
- Councils to sell off the most expensive social housing, so they can house more families for the same money
- Giving working people in social housing a priority right to move if they need to for a job
- Introduction of Capital Gains Tax on future gains made by non residents who sell residential property in the UK
The measures received a mixed welcome from the housing industry, with NHBC’s chief executive, Mike Quinton, saying: “We welcome today’s Autumn Statement highlighting measures to support house-building in the UK.”
David Newnes, of LSL Property Services – owners of the largest lettings agency in the UK – said: “Today the Chancellor has laid down some concrete steps to address the lack of supply in new housing, but this is only the start on the wider path to solving the problem. While Government initiatives such as the Funding for Lending and Help to Buy schemes have bolstered the recovery this year, the elephant in the room has always been the woeful shortage of new homes.
“The pledge of £1bn of loans to unlock large housing developments is certainly a welcome move and plans to increase local authorities’ housing revenue account borrowing limits are encouraging measures, both will play a part in boosting house supply, while at the same time preventing house prices from rising out of reach of buyers. Equal focus on expanding the Right to Buy offer and the Government’s investment into affordable housing shows efforts are being made. The Government must continue to lend a helping hand to aspiring buyers, so that they can achieve their dream of home ownership, while emphasising the need for more homes to support a healthy rate of recovery for the market as we move into 2014.”
Elsewhere, on the taxing of non residents, Liam Bailey, of estate agents Knight Frank, said: “Tax is not the primary driver for the majority of international buyers of residential property in London. We anticipate that the removal of the CGT exemption for non-resident purchasers will have only a marginal impact on demand and pricing.”
Banks and building societies are being urged to reconsider their lending criteria for those in later life after the Chancellor announced changes to the state pension.
Brokers said lenders would need to ‘rethink their lending policies’ after George Osborne announced an increase in the state pension age.
Andrew Montlake, of mortgage brokers Coreco, exclusively told Zoopla: “As it becomes more evident that people will be working until they are older, with a retirement age of 70 no doubt becoming a norm, lenders do need to rethink their lending policies to accommodate this change.
“While there is much regulatory clamour around lending into retirement, the last thing many borrowers need is to be constrained by anachronistic lending policies that do not take into account changes in working practices.”
Lenders have traditionally capped the age at which they will lend to borrowers to a retirement age of around 65 years old. It can be higher or lower than this depending on the individual lender.
The Chancellor said in the Autumn statement that anyone born after 1990 will have to work for five years longer than those today before they can claim the state pension.
It means anyone currently in their 40s or younger will be affected by the move.
Plans to raise the pension age to 67 by 2028 will not change, but under the new rules the age is expected to reach 68 by the mid 2030s and 69 by the 2040s – much earlier than had previously been predicted.
At present, a man can start to claim his state pension from the age of 65 and a woman from 61 and nine months.
Average value of a home expected to rise as much as typical annual wage during the next six months, according to the latest Zoopla survey.
Almost nine out of 10 homeowners expect house prices to rise during the next six months by the same amount as the average wage.
It represents a record four year high, according to the latest Zoopla Housing Market Sentiment Survey.
It is the latest evidence of confidence in the housing market, with prices expected to rise by more than 5 per cent in the next six months. Based on an average house value in England of £250,000, it equates to £12,500.
The figures follow the introduction of the Government’s Help to Buy mortgage guarantee earlier this month, aimed at helping those with a small deposit to buy a home.
Lawrence Hall, of Zoopla.co.uk, said:
“While London remains the forerunner in homeowner optimism, confidence in the property market is surging across the whole UK.
Confidence is the bedrock for healthy property transactions but it can’t work in isolation. Fortunately, mortgage lending is on the rise, first-time buyers are returning to the market, and the second phase of the Help to Buy scheme should help boost confidence further across the country and not just in London. All of this bodes well for a healthier market and could lead to more and more transactions, which in turn will create a more sustainable market.”
The Government introduced the first phase of its Help to buy scheme in April this year. It helps those with a small deposit to buy a new build home by providing an loan that is interest free for five years.
The scheme is proving popular, with insurer NHBC announcing a 19 per cent increase in the number of new homes registered during the three months from July compared to a year earlier.
Richard Tamayo, NHBC commercial director, said:
“Our latest figures show a sustained broad-based recovery in the UK new housing market from an extremely low base. There is little doubt that Government schemes, such as the Help to Buy initiative, have significantly contributed to the growth seen throughout the course of this year.”