Commenting on the Budget, Richard Sexton, spokesman for e.surv Chartered Surveyors, the UK’s largest residential surveyor and valuer, said:
“The relative scarcity of mortgage funds remains the largest break on recovery at this time. The concern is that banks that will be hit by the Chancellor’s new banking levy and will have fewer funds available to lend to consumers. Combined with the requirement for many banks to repay the Government Liquidity scheme support, there does not look to be a huge uplift in funds becoming available in the near future.
“However, whilst unwelcome, the 28% rate is better than many will have expected and offers some comfort to investors. In the absence of a wider economic downturn, it is hopeful that the market will continue its gradual recovery in values and transaction volumes.
“A rise in CGT of up to 40% was forecast prompting fears that buy-to-let landlords may exit the market in large volumes. The knock-on effect would have been an increase in supply and therefore a reduction in prices, whilst also removing a much cherished certainty for investors.
“Since late 2007, buy-to-let investors have partly filled the significant hole left by the absence of first time buyers. If a rise of 40% in CGT had gone ahead we can speculate that buyers would have been driven away from the sector in significant numbers and this could have had profound structural impacts on the wider market.”
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