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Luton Home Buyers £4,697,114 Windfall as Stamp Duty Holiday Stretched to September…

...and new 5% deposit mortgages for

Luton first-time buyers


The Chancellor Rishi Sunak announced two initiatives to keep the Luton property market firing on all cylinders into 2021.


Firstly, the £500,000 zero-rate Stamp Duty band has been extended to the 30th June 2021. After then it will phase down to £250,000 for an additional three months, returning to the pre-pandemic levels on the 1st October 2021. Secondly, Mr Sunak announced a scheme that will allow Luton first-time buyers to buy their Luton home with a 5% deposit from this April. Let me look at what each initiative means to the Luton property market.


  1. Stamp Duty Holiday extension for Luton home buyers


Coming out of the first lockdown in the early summer of 2020, there was a lot of apprehension that the British property market would flounder. Therefore, when the Stamp Duty Holiday was announced back in July 2020 to boost the property market, the deadline was set at the 31st March 2021.  Little did anyone know of the snowball effect of people wanting to move because of the initial lockdown in the spring of 2020, the pent-up demand following the conclusion of the EU negotiations with the subsequent ‘Boris Bounce’ and then the Stamp Duty Holiday which made the perfect storm for what has been the busiest property market in Luton since 2001/2.


The average stamp duty paid by a

Luton homebuyer is £2,833


The reason the Stamp Duty extension is important is that many estate agents and solicitors have been warning for the last couple of months that home buyers would pull out of property deals or renegotiate if they could not complete their sale in time before the Stamp Duty Holiday ended.


So, by phasing down the Stamp Duty Holiday, this will allow some breathing space for burdened solicitors and mortgage lenders, thus decreasing the number of buyers pulling out of their property purchase because they unexpectedly have to find up to an extra £15,000 in Stamp Duty when property sales do not complete on time.


There are currently 1,658 properties that are sold STC in Luton alone and the vast majority of those will save money on their stamp duty because of this extension


So, what does the Stamp Duty extension mean for Luton house prices?


The extension has heightened confidence in the Luton property market. The Government watchdog ‘The Office for Budget Responsibility’, has predicted that house prices in 4 years’ time will be just over 13% higher, compared to their pre-Christmas predicted figure of 11% growth (over the same time frame).


  1. 5% deposit mortgages for Luton first-time buyers


From next month, Luton first-time buyers will be able to buy Luton homes worth up to £600,000 with a 5% deposit and a Government-backed mortgage with a fixed rate of up to 5 years.


Rishi Sunak wants to turn the millennial ‘Generation Renters’ into ‘Generation Buyers’ and believes this initiative should be able to help two million people get on the property ladder. When we look at what that would mean for Luton, I estimate …


6,802 Luton people could be helped onto the

Luton property ladder with these 5% deposit mortgages


The Government backed scheme will be open to Luton first-time buyers for 21 months (until the end of 2022) and available from lenders including NatWest, Lloyds and HSBC (plus others to be announced soon). It will be available on all Luton homes new or second hand (previous schemes applied to new homes only).


5% deposit mortgages were all but withdrawn from the market at the start of the pandemic in spring 2020 with an almost default minimum deposit of 10% (even as high as 15% in the autumn just gone) putting homeownership out of reach for all but the wealthiest Luton first time buyers.


I must admit I found it a scandal that homeownership among the 25 to 34 year olds plummeted from 69% in 1981 to 36% by 2014, although with certain Government incentives and low interest rates since then, that had risen to 41% by last year, but it’s not enough


With so many young families paying huge sums in rent, who could effortlessly afford to make mortgage repayments on the same property, they haven’t been able to save enough for a 10% initial mortgage deposit, let alone 15%.


Yet now with these new 5% deposit mortgages, many Luton first-time buyers will be able to afford to buy their first home in Luton. Banks will typically lend between four and a half and five times the gross annual income – this means with a modest 5% deposit; many Luton 20 and 30 somethings will now be able to buy their first home. Just before I finish this topic, the 5% deposit mortgages will also be available to current Luton homeowners who don’t have the equity built up in their existing home – thus helping second or third (or more) time Luton buyers as well.


How do both of these changes affect Luton buy-to-let landlords?


I know many of you Luton landlords are adding to your Luton rental portfolio because of the Stamp Duty Holiday and with the extension, you too will save some money from it. The issue of first-time buyer mortgages does mean the demand for private rented accommodation in Luton might not be as strong in the coming decade.


Don’t get me wrong, tenant demand will continue to outstrip supply of Luton rental properties for the foreseeable future, yet the tenant/landlord balance could alter slightly in the medium term. Luton landlords need to take a long hard look at their properties and ascertain if they are fit for purpose both now and into the 2030’s. Tenants are becoming a lot more demanding of what their rental property offers. Wood chip wallpaper, avocado green bathroom suites and kitchens fitted in the 1990’s (or before) simply won’t cut the mustard in the next decade.


The demand from Luton tenants for properties with larger gardens, or the ability to keep pets or an extra reception room/garden office to allow them to enjoy their rented home more and also being able to work from home will ensure greater demand for your rental property … and the best bit, they will pay handsomely for that in higher rent.


If you are a Luton homeowner, buyer, tenant or landlord and you want to discuss your options on selling, buying or renting a property in Luton and the surrounding area, do not hesitate to contact me personally.


Author: Taylor Kay


How wealth is distributed will always be a contentious issue, especially as the Baby Boomers (those aged between their late 50’s and late 70’s) wealth has grown exponentially over the last 20 years, compared to the wealth of the younger generation.

With most UK property in the hands of the older generation, with its total value about to smash through the £8 trillion barrier (up from £3 trillion at the start of the Millennium), is it right that so much wealth is concentrated in the hands of the older generations?

As national house prices have continued to grow unabated (for example in the last eight years by 49.9%, whilst real take home pay has only increased by 11.8%), this has meant younger people are finding it even harder to get onto the property ladder and those already on it to move up it.


Looking at the older end of the age range for home ownership …


of the 77,462 homes in Luton, 16,145 households are 65 years or older, and 76.8% of those households (12,403) are owned (mostly without a mortgage).


A full split as follows …


  • Owned 76.8%
  • Council House 17.0%
  • Privately Rented 4.2%
  • Living Rent Free 1.7%
  • Shared Ownership 0.2%




I talk with many Luton pensioners who want to move yet are unable to. There appears to be a shortage of suitable properties in Luton for members of the older generation to downsize into. Due to their high demand and low supply, Luton bungalows and suitable ground floor apartments achieve on average a 15% to 25% premium per square foot over two/three storey properties. Yet would it surprise you only 1% of new builds in the UK are single storey bungalows (compared to 7% 25 years ago)?


Luton pensioner homeowners are now worth £4.87bn.


YouGov did a survey a couple of years ago and they found that just over one third of homeowning pensioners in the UK were looking to downsize into a smaller property. As I have stated before, as a nation, we need to rethink how we can encourage older homeowners to sell their larger homes to release them to the younger families that desperately need them.


The Government over the last 11 years have appeared to target all their attention on first-time buyers with a strategy such as the Help to Buy Scheme. However, this doesn’t address the long-established under-supply of appropriate retirement housing vital to the needs of Luton’s quickly ageing population. Unfortunately, Luton’s housing stock is sadly ill-equipped for this demographic shift to the ageing homeowners.


Also, to add insult to injury, those more mature Luton pensioners in their 80’s and 90’s who do live in the restricted number of Luton bungalows and suitable ground floor apartments are finding it difficult to live on their own, as they are unable to leave their bungalow/apartment because of a shortage of sheltered housing and ‘inexpensive’ care home places.


This in turn means the younger 60 to 70 year old Luton retirees (in their bigger two/three storey family houses) can't buy those Luton bungalows (occupied by the older retirees), which means those Luton families in their 30’s and 40’s can't buy those larger family houses (occupied by the younger 60 to 70 year old retirees) they need for their growing families ... it’s like everyone is waiting for everyone because of the logjam at the top of the property ladder.


So, what is the solution? Quite simple – build more homes!


In the last 30 years, the UK population has grown by around 12 million people, yet the number of properties has only grown by around 4.2 million.


With obstructive planning regulations, immigration, people living longer and increased divorce rates (meaning one family becomes two) we have needed 275,000 properties to be built a year since the Millennium to just stand still and meet demand. Twenty years ago, the UK was building on average 185,000 households a year, that figure dropped in the five years after the Global Financial Crisis in 2008 to 140,000 households a year. Thankfully that has increased steadily over the last five years and last year we created 245,000 households in the UK, however we still have all those years since the Millennium to make up for.


The answer is to build on more land for starter homes, bungalows and sheltered accommodation because land prices are holding back the property market, as the larger national building firms are more inclined to focus on traditional two and three storey houses and apartments than bungalows (because they make more money from them). You might say there is no land to build the property on, yet …


only 1.2% of the UK is built on with residential properties.


So how could Luton people make money on this news? Shrewd Luton property investors should consider purchasing bungalows, especially ones that need some titivating (possibly after somebody has passed away). Bungalows purchased at the right price and location are a great gamble for flipping. They should also be considered for renting out as demand will only outstrip supply. This would be a start to the solution of rebalancing the Luton property market so everyone is happier with their lot.


If you would like a chat about the Luton property market – don’t hesitate to give me a call.






In Britain, there are 27,071,500 households, of which 17,044,450 are owned, which are worth a total of £3,925,865,212,950 (£3.92 trillion). Over the last 5 years, an average of 86,096 properties sell each month, meaning just over a million UK households move home per year. Therefore, the average British homeowner moves every 16 years 5 months.


These statistics refute a common hypothesis that British neighbourhoods are becoming more fleeting and transitory. On the face of it, they appear to show that, once you have succeeded to buy a property you can call home, there isn’t much motivation to move again.


So, aren’t people moving home so much?


Could it be put down to a certain sense of complacency or apathy to moving home? Whereas we might love our home in Luton, most of you (including myself) still want to ‘better our lives’ with a bigger house, better area etc, which typically requires us to climb up the Luton property ladder.


Yet with Luton house prices having risen by 206.2% in the last 20 years, the cost of going up the next rung on the Luton property ladder is prohibitive.

Everyone harks back to the 1980’s, when we had an upbeat booming property market as a backcloth, Brits moved home every eight years; so now with the average at just over 16 years this equates to each British homeowner moving around three to four times in their adult lifetime. Maybe we should all call our homes ‘Dunroamin’ and be done with it!


Or does it? 


We have all heard the phrase ‘lies, damn lies and statistics’ … well the stats mentioned above hide some amazing features of the British property market. When homeowners get into their 50’s and 60’s, their tendency to move home drops like a stone. The average length of time a homeowner without a mortgage moves home is 24 years and 7 months (and just under 7 out of ten outright homeowners i.e. without a mortgage are 65 years old or older). 


Yet, homeowners with a mortgage move on average every 10 years and 11 weeks.


So, whilst I cannot determine who has a mortgage and who doesn’t, I can look at how quickly people move home in Luton.  I have looked at the last 50 property sales in Luton, and I have found some interesting findings.


On average Luton homeowner only move every 15 years

and 48 weeks.


Nothing interesting about that you might say, when compared to the national average ... yet the devil is in the detail.


There appears to be a two-speed Luton property market … look at the top 25% of Luton home movers, and then the next slice … these Luton people are moving home really quickly, yet the gap for the next two slices widens tremendously.


  • Top 25% quickest Luton home movers move every 3 years & 43 weeks
  • The next 25% quickest Luton home movers move every 13 years & 28 weeks
  • The next 25% quickest Luton home movers move every 20 years & 43 weeks
  • Whilst top 25% slowest Luton home movers only move every 25 years


When looking at the properties that fall into the later bands (i.e. the ones that don’t move/sell so often), they tend to be the larger properties where the homeowners have lived for 25/30 years plus.


The lesson we all should learn is that once people get into their 50’s and 60’s, their propensity to move home drops considerably. This means the properties on the lower rungs of the Luton property ladder do appear to sell quickly (as they are occupied by younger homeowners) yet once Luton people get older, their tendency to move diminishes. This puts a roadblock on the younger generation wanting to buy the larger Luton properties these mature homeowners live in.


What is holding the older generation back from selling and downsizing to free up homes for families that desperately need them? Some of it will be apathy, some of it will be holding on to the home that they brought their family up in, yet the bottom line is…


46.5% of the homes owned in Britain have

two or more spare bedrooms.


As a nation, we need to rethink how we can encourage older homeowners to sell their large homes to release them to the younger families that desperately need them. Some suggest tax breaks, yet the Government won’t be in the mood to give huge tax breaks as the measures to protect the economy over the last 12 months will ultimately need to be paid back.


One thing I do know, we as a Country have seen (and will continue to see) a lot of demographic change together with an increasing elderly population, so it’s not just about how many homes we build, but whether we are building the right kind of homes the older generation will want to move into.


Interesting times ahead for the Luton property market!


If you have a Luton property to sell or let in the coming weeks, months or years and would like to know how this and other factors will affect you and your property ... without obligation, don’t hesitate to give me a call or drop me line.


Author: Taylor Kay















Over the last six months, the Luton Property Market has been flourishing. As soon as an estate agents ‘For Sale’ flag went up, neighbours would be checking out Rightmove to see the internal pictures and compare the asking price to their own home (go on .. admit you do that too – every Luton homeowner does). Flabbergasted by optimistic asking price tags, those same Luton homeowners stand open-mouthed to see a sold slip added to the board a few weeks later.


Property values in Luton are 4.7 per cent higher than a year ago.


The newspapers are full of stories of this mini property market boom, which has been fuelled by the Stamp Duty Tax cut, which ends on the 31st March 2021. Not only has it pushed up values in Luton, but it has also theoretically brought forward house moves from 2021 into 2020.


The most up-to-date transaction figures (i.e. the number of people moving home) endorse it too. In the UK, 137,200 property sales/transactions took place in December, the highest number of sales/transactions in December since 2006 (when it topped 149,200 transactions, only for it to fall to 32,700 transactions in December 2008 at the height of the Credit Crunch).


The exact figures from the Land Registry for Luton won’t be available for another six weeks or so, yet in December 2019, 251 properties changed hands in Luton. Looking at anecdotal evidence of for sale board changes, my database and the portals, I believe we will end up around 338 to 351 Luton property sales/transactions for December 2020.


So, how does all this compare to other years?


The number of UK transactions continued to be relatively stable between November 2019 and March 2020. That decreased by around half in April/May 2020 compared to April/May 2019, triggered by economic impacts relating to the public health restrictions introduced. Since the first lockdown was lifted in the late spring, sales/transactions have increased steadily upwards each month, mirroring the relaxing public health restrictions for the property market during the summer and autumn of 2020 and introducing Stamp Duty Tax Holidays.


Before we all get the Champagne corks flowing, what the December national figures (and the corresponding provisional Luton stats) don’t tell us, is that April to December 2020 transactions ended the year 13.7 per cent down compared to April to December 2019 transactions — the lowest since 2012. Don’t get me wrong, 13.7 per cent is impressive given that we are in the middle of a recession and even more remarkable considering there was a 48.7 per cent fall in transactions in 2008 (compared to 2007) when the Credit Crunch hit.


The biggest question though, is, how much of the urgency since the summer to buy property can be credited to the …


  • existing pent-up demand that built up in 2018/9 and was starting to be released in the ‘Boris Bounce’ in January/February 2020
  • new demand from home workers looking for bigger properties
  • people moving out of the big city centres
  • the Stamp Duty Tax cut


— or a mixture of all four?


Nobody can categorically know whether the UK property market would have ricocheted as quickly without the Stamp Duty Tax cut.


Talking to many buyers, sellers, agents and solicitors in the Luton property market over the last three or four months, the anecdotal evidence I have collated from those people seems to imply that the outbreak of activity in the Luton property market has mainly been put down to the lifestyle factors (bigger house with office space etc) and pent-up demand, meaning the Stamp Duty Tax Holiday is seen as the icing on the cake for most people. Yet, there will be some buyers, whose motivation has been purely to save money on the tax duty. Overall though, in the vast majority of house purchases, this allows us to be reasonably hopeful about what will happen once the Stamp Duty Tax Holiday is withdrawn on the 31st March.


However, some newspapers are preaching a story that the property market will collapse without a Stamp Duty Tax Holiday extension. Nobody can argue that a phased withdrawal from the Stamp Duty Tax Holiday would be better than some homebuyer’s sales falling through, when the tax holiday finishes in late March. Even if your motivation isn’t to save money on the tax holiday, it could be the motivation of a buyer in your chain – meaning it becomes your issue. Nobody knew in July, when the tax holiday was announced, that we would get another two national lockdowns with the inevitable delays from remote working by solicitors, mortgage providers and local authority search departments. My advice to all people currently sold subject to contract is to ask the question, “What if we don’t complete the sale by the end of March?”. Better to sort it now than have a nasty surprise in the last week of March.


All property taxation is long overdue for reform, from Stamp Duty to Council Tax. When Margaret Thatcher tried to change local Rates to Poll Tax in the late 1980’s, those who are old enough can remember the Poll Tax Riots, hence the nervousness of any party since to make any changes. There is no way the Government will abolish Stamp Duty when it raises between £11bn to £13bn a year, yet with all the upheaval we have experienced in the last year, there could be an appetite to change the way property is taxed.


The Government has already spent £271bn on interventions due to the pandemic and needs every penny so that it can start to repay those debts over the coming decades.


I have a feeling most Luton property buyers and sellers would compromise on the price they pay for their next home to cover the cost of the Stamp Duty Tax after April, rather than lose the chance of owning the forever home they longed for during the first lockdown.


Therefore, don't be alarmed when we see property values ease slightly in Q3 2021 when the price paid for property reflects the lower price to account for the Stamp Duty that will need to be paid from the 1st April.


If you are a Luton homeowner or Luton buy to let landlord and you would like a chat about where you and your Luton property stands in the current Luton property market, don’t hesitate to give me a call or drop me a line.

Author: Taylor Kay



What does this mean for Luton property owners?


With most Luton families home schooling their children in lockdown and the forthcoming Stamp Duty Holiday deadline on the 31st March 2021, less Luton properties have been coming onto the Luton property market since the new year. This has prompted a 17% drop in the supply of Luton homes for sale compared to November 2020.


For the past couple of decades, like clockwork, Luton estate agents’ busiest times for putting property onto the market is the new year to Easter rush, with a smaller flurry of new properties coming onto the market in the mid/late summer. Yet, since the ending of lockdown 1.0 in the late spring 2020, nothing has been normal about the Luton property market.


Throughout the summer, the number of properties coming onto the market in Luton steadily rose to its peak in November and the number of properties then becoming sold subject to contract (stc) rose even higher (and whilst statistics don’t exist for the properties sold stc, anecdotal evidence suggests there were just under 50% more Luton properties sold stc in the last six months of 2020, compared to the same 6 months in 2019).


However, back to the number of properties for sale…


the peak of the number of Luton properties on the market in autumn was 1,521 –  that now stands at 1,261.


The first lockdown caused many Luton homeowners to want to move with the need for extra space to work from home and in some cases larger gardens. This was further exacerbated by Luton home movers also trying to take advantage of the Stamp Duty Holiday to save themselves money on this tax.


This meant many more Luton properties came onto the market (more than a “normal” year) in the last 6 months of 2020. However, those Luton home movers motivated to move for the extra space/save money on the tax, did so in the summer/autumn and have already placed their home on the market (and are probably by now sold stc rushing to get their house purchases through before the deadline on the tax savings).


So, how does Luton compare to other property markets, and what does this reduction in Luton properties on the market mean to Luton homeowners and landlords?


There are 8% less properties on the market today in Luton, compared to 12 months ago.

When I compared that to the national picture, according to Zoopla, there are 12% less properties on the market today (compared to a year ago).

However, the complete opposite is taking place in London. There are currently 47,900 apartments for sale in London compared to January 2020, when there were only 32,600 – a massive rise of 46.9% … all the more interesting when there are only 15.1% more London semi-detached houses for sale and 1.8% more London detached homes over the same 12-month period. The jump in London apartments for sale is being pushed by an upsurge of London up-sizers eager to trade their city living apartment up to suburban houses, and a small handful of panicky London buy to let investors who are wanting to exit the London property market following falling rents for apartments. Looking closer to home, there are…

3% more apartments for sale in Luton than a year ago, whilst there are 22% less detached homes.

So, whilst there are some differences between the supply of individual types of property in Luton (e.g. apartments vs detached houses), the overall reduction in the number (i.e. supply) of properties for sale can only mean one thing, when there is a reduction in the supply of anything and demand remains stable, this will mean continued upward pressure on Luton house prices in the short term (although I suspect there will be some downward pressure on Luton apartments with that level of increase in supply – maybe some interesting ‘opportunities’ for all you Luton landlords?).

Will overall demand for Luton property continue to be stable?

Lockdown 3.0 will probably cause another wave of Luton people who want to move home (thus increasing demand). The last property crash (the Credit Crunch in 2009) was caused by a huge increase in the supply of properties for sale when people lost their jobs and interest rates were much higher. People couldn’t afford their mortgages and so dumped their homes onto the market all at the same time – causing an oversupply of property for sale and hence house prices dropped.

Compared to the 1,261 properties for sale in Luton today, at the height of the Credit Crunch in January 2009, there were an eyewatering 2,306 properties for sale in Luton.

It was this increase in the level of property for sale in Luton (mirrored across the whole of the UK) that caused property prices to drop between 16% and 19% (depending on the type of property) in Luton over the 12 to 14 months of the Credit Crunch. So, as long as there is no sudden change in the demand or supply of properties and interest rates remain at their current ultra-low level – the medium-term prospects for the Luton property market look good.

If you are a Luton homeowner or a Luton buy to let landlord and want to chat about the future of the Luton property market – do drop me a line.


NAEA The Property Ombudsman TSI Client Money Protect Rightmove Zoopla OnTheMarket