Finance expert calls for first-time buyer support reform
Financial data group Moneyfacts has called for reforms to support first-time buyers ahead of the Autumn Budget, highlighting concerns that existing schemes have failed to keep pace with rising property prices.
Rachel Springall, Finance Expert at Moneyfacts, said there will be considerable speculation about tax changes ahead of Chancellor John Healey’s first Budget on 28 October. Healey was appointed by Andy Burnham following the recent government reshuffle.
The warning comes after rumours of tax changes last year were blamed for causing disruption in the property market, raising concerns among industry professionals about potential volatility ahead of this year’s fiscal statement.
Lifetime ISA reform proposed
“There have been discussions about creating a new ISA aimed at first-time buyers,” Springall said. “This might help those looking to start saving for a home, but it would be beneficial to allow savers to temporarily access funds in their existing Lifetime ISA, without penalty.”
She noted that the house purchase cap on LISAs has not been adjusted since the product launched in 2017, rendering it less effective for borrowers in higher-priced property markets. The current cap has remained static despite significant property price increases over the past decade.
The calls for reform come as the property sector continues to adapt to regulatory changes, with new conveyancing platforms emerging to streamline transactions for buyers.
Tax reforms on horizon
“Taxation is set to be a hot topic in the run-up to the Autumn Budget,” Springall added. “But even without additional reforms, existing plans are going to transform estate planning, such as the inclusion of unused pension pots in inheritance tax liabilities from April 2027.”
The inheritance tax changes could have significant implications for property investors and those planning estates, particularly as probate property transactions become increasingly complex.
The government has not yet responded to the proposals for first-time buyer support reforms. Industry observers will be closely monitoring the Chancellor’s statement on 28 October for any announcements affecting the residential property market.
