By pledging to abolish stamp duty for first time buyers, Labour strategists have parked their tanks on the Conservative home-owning democracy lawn. In that simple move they’ve flipped the ordinary narrative of British politics being about the high spending reds against the tax cutting blues on its head.
The £225,000,000 giveaway leaves the Labour party offering a tax cut to first time buyers, while the Conservative party attempts to buy off the same demographic with government-subsidised mortgages under the successful help to buy scheme. Borrowing heavily from the Conservative’s own rhetoric, Miliband said in a campaign speech this morning: “There is nothing more British than the dream of home ownership, starting out in a place of your own”.
He continued: “But for so many young people today that dream is fading with more people than ever renting when they want to buy, new properties being snapped up before local people get a look-in, young families wondering if this country will ever work for them.
“That is the condition of Britain today, a modern housing crisis which only a Labour government will tackle”.
Although the tax cut for first time home buyers would only apply to homes costing less than £300,000, excluding most homes in almost all London boroughs, other housing policies announced by Labour today were less likely to be celebrated for cutting tax and red tape. As a preview of Miliband’s speech was trailed in this morning’s Guardian, the share prices of major British home builders took a hit on the realisation his other policies would have a significant negative impact on the value of homes.
Although the relatively minor stamp duty ‘holiday’ was the “centrepiece” of today’s announcement, perhaps more damaging in the long run is Labour’s mooted rent controls, preventing landlords from increasing rent by more than inflation, regardless of other factors. The Daily Telegraph reported the announcement, and fear of a coming Labour government wiped £200 million off the share values of major UK home builders.