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Reforms are needed to tackle house price volatility

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Higher buy-to-let taxes and the introduction of a deposit after an agreement to buy would take the heat out of the market

House prices began to cool in May according to official figures. The data from the Office for National Statistics confirms what we knew, or at least surmised from reports by estate agents and property experts, which is that tighter lending rules introduced in April slowed galloping property inflation. In the summer, the threat of higher interest rates spooked sellers, who turned a trickle of estate agency mandates earlier in the year into a bubbling torrent.

It goes to show that while politicians have fixated on the shortage of housebuilding as the main reason for rising prices, the game played by property investors, especially as they weigh up interest rate expectations, has also been a major factor.

Continue reading... Reported by guardian.co.uk 9 hours ago.

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