Home insurance customers can expect an increase in activity in the property marked buoyed by the increase in capital gains tax (CGT) announced in the latest Budget.
The announcement made by chancellor of the exchequer George Osborne is bound to have an impact on the housing sector, said an expert.
Increases to CGT will cause a flurry of activity as homeowners rush to sell their properties before the new rate is implemented, stated Helen Adams, managing director of FirstRungNow.com.
She said: "As soon as they [the changes] become effective then many landlords may sell their properties, which may even serve to bring down prices a bit."
Ms Adams added that this may work to the advantage of first-time buyers who would definitely have more options to choose from and benefit from the lowering of house price values.
However, some of the Budget announcements are likely to have a negative impact on consumer confidence.
Ms Adams added: "I think it [buyer confidence] will be dented anyway in terms of uncertainty about jobs. With VAT going up people will tighten their purse strings and become cautious."
Her comments follow in the wake of the coalition government opting to raise VAT from 17.5 per cent to 20 per cent.
Chancellor Osborne also increased the basic insurance premium tax by one per cent while those on a higher rate would now be paying tax at 20 per cent.
The latest YouGov Household Finance Index found that 27 per cent of households in Britain saw their family finances decline in June. Another 44 per cent of families expected their financial conditions to deteriorate further.
However, recent statistics published by moneyfacts.co.uk revealed that mortgage rates had dropped to a seven-year low. This resulted from lenders trying to lure customers away from standard variable rates towards products with low fixed rates.  |
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