If you were asked to sum up 2018 in one word, the chances are it would be Brexit. How, when and even if we exit the EU in 2019 is all anyone’s talking about this month, in Westminster, the media and even on the street. Yet the impact of Brexit on the housing market is a matter of debate.

London house prices have been stalled for a while, but this isn’t the case everywhere in the UK. As to next year, what will happen to house prices is anyone’s guess with some commentators predicting steep rises, once the uncertainty of Brexit is over, and others believing prices will fall, whichever way we exit the EU.

There’s been more to 2018 than Brexit, however, from the feel-good factor of May’s royal wedding to the budget announcements designed to increase the supply of new homes. Read on for our review of the year’s highlights for buyers, sellers, renters, landlords and investors:


Stamp duty break has helped boost confidence among millennials

One in seven millennials say they are more confident about their home ownership prospects following the recent changes to stamp duty for first-time buyers.

This news, which derives from research carried out by the Foresters Friendly Society, is positive and perhaps to be expected, but with property prices in London in particular still out of reach for many first-time buyers, the stamp duty break will not benefit all of them, including some looking to buy in parts of Islington and Stoke Newington.

The Chancellor announced in the last Autumn Budget that stamp duty would be abolished, and this measure would mean a stamp duty cut for 95% of first-time buyers, while 80% of first-time buyers would not have to pay stamp duty at all.

No stamp duty now needs to be paid by first-time buyers when buying a property worth up to £300,000, nor does stamp duty need to be paid on the first £300,000 when purchasing a home worth up to £500,000.

But lack of housing supply remains a key issue, an issue which was addressed extensively by the Chancellor in the Autumn Budget. However, there are fears that unless the number of affordable homes increase, the abolition of stamp duty for first-time buyers could result in house price rises.

Meanwhile, the research also revealed that some of those who are saving for a deposit on a property are not always using the best means of doing so. First-time buyers are therefore being encouraged to make sure they explore all saving product options available to them when they start saving for a deposit.

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Financial Reporter 

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Younger people still see value in buy-to-let property investment

Younger people continue to see real value in investing in property over pensions, as new data reveals a year-on-year rise in buy-to-let mortgage purchase applications form that age demographic.

Buy-to-let and landlord mortgage broker, Commercial Trust, has released data which shows that, since 2015, people aged between 20-39 have increasingly viewed property as a sound investment decision, more so than pensions.

Commercial Trust Ltd’s Chief Executive, Andrew Turner, said: “The figures suggest that younger people can see the value in investing in bricks and mortar – and perhaps this is an indicator that they perceive property investment as a sounder investment than pensions in the longer term”.

By contrast, there has been a decrease in the number of people aged 60 or over taking out buy-to-let mortgage purchase applications.

In the years since 2015, there has been a fall in the number of over 60s taking out buy-to-let mortgage applications, falling from 25% to approximately 18% in 2017.

This is generally positive news for the future of the buy-to-let sector, as it reveals that many members of the younger generation and working age professionals still regard property as the ultimate investment and a relatively secure asset class.

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Letting Agent Today 

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First-time buyers capitalise on slower sales market

The cuts to stamp duty are incentivising first-time buyers to purchase property, with an increase in the number of first-time buyers securing property in December 2017.

According to figures released by NAEA Propertymark, first-time buyers accounted for 32% of property sales in the last month of 2017, an increase on the previous month, where first-time buyers accounted for 27% of property sales.

Generally speaking, there is an increase in sales market activity once we step into January, while December is traditionally a slower month for buyer activity.

Mark Hayward, the Chief Executive of NAEA Propertymark, said: “We see this, year in, year out. Buyers take a back seat in December to enjoy the festivities, while sellers keep their homes on the market in the hope that someone will take interest and make an offer.”

Hayward continued: “What we don’t usually see is first-time buyers capitalising on this slump and using it to their advantage – 44% of our members think that the Chancellor’s stamp duty cut for first-time buyers will encourage more to make offers, and it looks like that’s what we’re starting to see.”

It is positive to see a higher proportion of potential first-time buyers capitalising on the stamp duty cuts. But in London in particular, and this includes Islington, Stoke Newington, Newington Green and Highbury, first-time buyers may struggle to find a property which allows them exemption from stamp duty.

When the Chancellor announced the abolition of stamp duty for first-time buyers last November, this took immediate effect. But it is only relevant for first-time buyers purchasing property worth up to £300,000, while the usual 5% stamp duty rate applies when buying property worth between £300,000 and £500,000. In other words, not all, but most first-time buyers will be able to claim some stamp duty relief.

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Property Industry Eye 

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Second homebuyer boost at the start of this year

The number of people looking for a home increased by 37% during the month of January, according to NAEA Propertymark.

The number of property seekers registered per estate agent branch increased in the first month of the year, however, these were largely ‘second steppers’.

The supply of properties also increased at the start of the year, though these properties have largely been those looking for a second home, not first-time buyers.

NAEA Propertymark’s Chief Executive, Mark Hayward, said: “As we usually see in January, buyers and sellers have re-entered the market after the festive slow-down and triggered an uplift in the number of sales agreed”.

Hayward continued: “Our members have noticed first-time buyers holding off on making purchases…and saving for longer to maximise the full stamp duty relief.”

Changes to stamp duty for first-time buyers took effect following last November’s Autumn Budget, where it was announced that those buying their first property would be exempt from paying stamp duty on properties worth up to £300,000. The usual rate of stamp duty would then apply on the purchase of properties worth between £300,000 and £500,000. This means that most first-time buyers securing a home in London will pay some stamp duty.

Interestingly, the number of property sales to first-time buyers increased in 2017 but fell by 5% between December 2017 and January 2018.

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The Negotiator

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Most renters prefer flexibility of renting to home ownership

Most renters in the UK don’t want the commitment that comes with home ownership, preferring instead to continue renting as it offers greater flexibility.

According to analysis carried out by Direct Line for Business, some 70% of renters are happy not to purchase a property and remain in the private rented sector.

The results of this study should encourage Islington, Highbury, Stoke Newington and Newington Green landlords to feel optimistic about the future, as it appears tenant demand is set to continue.

The study also suggests that general attitudes in Britain might be changing, with growing numbers of renters content to rent property for longer.

Business Manager at Direct Line for Business, Christina Dimitrov, said that the findings showed a “major attitudinal shift” had taken place, with more people viewing renting as a long-term reality rather than a short-term one.

Dimitrov continued: “While price is a factor, many people are increasingly comfortable with the flexibility afforded by renting a property rather than jumping into home ownership”.

Though affordability is the reason why most renters don’t want – or cannot afford – to buy, a growing number of renters enjoy the flexibility that comes with renting, and like having the freedom to travel while not being tied to any one place or property.

However, the study also found that Londoners generally spend less time renting before they buy a property. On average, renters in London rent for 12 years prior to purchasing their own home, while renters elsewhere in the UK rent for just over 15 years, on average.

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Property Wire

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15% price boost for properties near top-performing state schools

Property prices have risen faster in areas close to top-performing state secondary schools, new research shows.

According to figures released by Lloyds Bank, the prices of properties near top state schools have increased 15% more than the national average over the last five years.

It’s no secret that property buyers with children of school age are prepared to pay more to live near good schools – the same is true in Islington, Stoke Newington and Newington Green – but this research reveals a considerable premium of 36%.

House prices in the vicinity of The Latymer School, a well-regarded grammar school in north London, have experienced the highest growth – 59% – in the last five years.

Lloyds Bank Mortgages Director, Andrew Mason, said: “Providing their children with a good education is a priority for most parents and is often on the list of key considerations for families looking to decide where to live.”

Though properties which sit within the catchment areas of good schools come with a premium purchase price, buyers can benefit should they decide to sell their property.

Though some families choose to move out of London for more space when their children are at school age, the many outstanding schools on the doorstep in Islington ensure there are always options for parents who want to remain in the capital.

We’ve listed the top secondary schools in Newington Green and the surrounding area and the best schools in Islington, both of which should be useful if you’re looking to settle in the area.

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Money Wise 

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Budget brings stamp duty cut for shared ownership buyers

It was a budget for the “strivers and the grafters,” who are “the backbone of our communities and our economy,” according to the Chancellor, Philip Hammond, who presented his final, pre-Brexit Budget on 29th October 2018. Among them were first-time buyers of shared ownership properties, who stand to benefit from changes to stamp duty.

“We can’t deliver the high standards of living the British people deserve without fixing our housing market,” said Mr Hammond, before announcing the move, which will abolish stamp duty on shared ownership properties worth up to £500,000, where the first-time buyer purchases a 25% to 75% stake. The benefit will be applied retrospectively to sales in the past year.

In his previous Autumn Budget, the Chancellor removed stamp duty for first-time buyers on all properties up to £300,000. This, he says, has helped 121,500 people onto the housing ladder and placed the number of first-time buyers at an 11-year high.

Mr Hammond also announced a two-year extension of the Help to Buy equity loan scheme, which offers a government loan of up to 40% (in London) of the purchase price for a newly-built property. The scheme was due to end in 2021, but has been extended until March 2023, for first-time buyers only.

A price cap on the homes eligible for the scheme has also been increased meaning that, in London, buyers can use Help to Buy for a property costing up to £600,000.

Read more about the Autumn Budget 2018, and its impact on the housing market, on the BBC website.

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