According to Monaghan (2017) fewer mortgages have been approved across the UK, the lowest level in 13 months which suggests a downturn in the UK housing market. In addition to this, the British chancellor’s recent proposal to remove stamp duty land tax (SDLT) for first-time property buyers may, in fact, increase house prices even further. As house prices increase; so does the monetary deposit that is required for an aspiring homeowner. With stagnant wage growth; the rise of inflation and increase to the Bank of England’s base interest rate from 0.25% to 0.50% – saving up for a reasonable deposit may become even more difficult for some. With this viewpoint in mind, it seems that the removal of SDLT has made little difference for those seeking to buy their first home in the UK.
Nonetheless, the growth of UK house prices has been forecasted to increase by 2-3% in 2018 due to a combination of factors. These range from supply shortages of available homes that are up for sale in the property market; rising levels of employment and a low UK base interest rate of 0.50%!