Trade body Homes for Scotland has called on the Scottish Government to take action to tackle a lack of activity at the higher end of the housing ladder.
It says that there has been a considerable drop in activity in this sector of the housing market, which Homes for Scotland is attributing in part to the higher rate of Land and Building Transaction Tax (LBTT) applicable to more expensive properties. It is calling on the Government to extend the 5% tax band, which currently applies to properties valued above £250,000 to £325,000.
“As we have expressed in submissions to the Scottish Government and Scottish Parliament, if we are to have a healthy and well-functioning housing market, we need a tax framework that enables movement up and down all price levels,” explained Nicola Barclay, Chief Executive of Homes for Scotland. “However, feedback from our members shows that the present system (which varies considerably from that south of the border) is creating significant barriers.”
“Whilst in volume terms this may currently impact only a relatively small number of customers, the concern must be that, if aspirational buyers are unable or indeed choose not to move, this will create blockages lower down and place more pressure on the price of the fewer homes that do come on the market,” she added. “Not only will this distort the market, it will also ultimately exacerbate the housing crisis. Clearly, this is not good news for the three quarters of Scots who wish to own their own home and will also only serve to put further pressure on the social and private rented sectors.”
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