Barclays is calling for people who took the tax break to free up 3.8m homes
Barclays, one of Britain’s biggest lenders, has urged the government to introduce tax breaks and financial incentives for downsizers to encourage them to move into smaller homes, potentially freeing up 3.8 million family homes.
The bank suggests allowing downsizers to deduct moving costs when buying a new home.
In a report released on Thursday, Barclays stressed that reducing the financial burden of moving houses could encourage “underprivileged” people to move, helping to ease the housing crisis. Along with the financial incentives, the bank has requested measures to facilitate the relocation process and the construction of more retirement homes.
Barclays estimates that this could significantly increase capital in the housing market, benefiting growing families who need larger homes. “A strong, comprehensive strategy is needed to address the major challenges facing the housing market,” said Mark Arnold, head of housing and savings at Barclays.
The call for support for downsizers follows a report by Savills showing that the over-60s make up 44% of homeowners, but downsizers make up less than 10% of market activity. Lucian Cook, director of residential research at Savills, said reducing the stamp duty burden on downsizers could encourage more people to move and make better use of existing housing.
However, critics argue that such a tax break would disproportionately benefit wealthy homeowners rather than first-time buyers or hard-pressed families. Mortgage broker Martin Stewart questioned the fairness of the program, asking, “Why is it being promoted to the generation that has benefited the most from rising housing prices over the past few generations?”
Aneisha Beveridge, head of research at the Hamptons, echoed these concerns, suggesting that funding could be better directed elsewhere, particularly as downsizers are often tax-free and have benefited greatly from rising house prices in recent decades.
