New Homes Should Build Upon Civic Pride And Pleasure

The doom-mongers keep on getting it wrong. Inaccuracy is the only reliable feature of their bleak prophecies. At the height of the coronavirus crisis, they warned with almost ghoulish excitement that the housing market was on the verge of meltdown and property prices were about to crash.

- Leo McKinstry

But that forecast turned out to be as mistaken as most of the others. Far from collapsing, the property sector has roared back to life since the relaxation of the lockdown. Only this week, the latest official statistics revealed that construction rose by 8.2 per cent in May, more than four times the overall rate of growth in the economy.

Private sector house-building was up by a fifth during the month, while residential construction in the public sector surged by 42 per cent.

It is the same story with sales, where the end of the lockdown has unleashed a wave of pent-up demand. A large dose of rocket fuel has been added to the recovery by the Chancellor’s recent mini-Budget, which dramatically suspended stamp duty on all transactions worth less than £500,000.

As a result, 90 per cent of purchasers will pay no tax at all until the end of March next year. In this new climate of optimism, property websites and mortgage brokers say that interest from potential buyers is up by almost 50 per cent since Rishi Sunak’s statement.

The buoyancy is further helped by the available of cheap credit, with mortgage rates at a historic low.