Look4aProperty.com’s Blog

A two per cent base rate is fine but the Government needs to go the extra mile to have any hope of kick-starting the UK housing market.

Firstly, people need to start spending. This rate cut is not going to make that happen.

Money Lane

I detect a change of mindset in the past six months. People are terrified about losing their jobs. Any money consumers can claw back through rate cuts is going to be saved for a rainy day – and many of us are expecting a downpour in 2009.

People are still not going to start spending because they are worried about losing their jobs. If you are scared of losing your job you are not going to go on a spending spree.

Thousands of jobs have been lost in the UK recently. Even government agencies like HMRC are making reundancies. If people get bonuses this year they will be hoarding them away, not spending them and until the job losses slow or stop I can’t see that people will want to spend their money.

The Government needs to stop pussyfooting around. All these measures are at arm’s length and policies need to be more direct. The only way to kick start the housing market is to scrap stamp duty for one year, and to get the banks to start lending.

It needs to force the banks to start lending – otherwise what is the point in having bailed them out with taxpayers’ money?

Aaron Turner

The Government now holds a controlling share in a number of High Street banks. So why is it appointing itself to non-executive roles? My advice – Get on the board and start making things happen!

The Next Steps – what Gordon Brown and his Chancellor should do now:

::Kill stamp duty for at least a year immediately – the housing market will come back to life overnight

:: Make things happen with the banks – no more token gestures – start lending to the consumer, small businesses and to each other

:: Job security is the overriding need amongst consumers so redeploy people in government agencies rather than make them redundant as this is contributing to the problem even more – people think if even the Government is laying off then things must be really bad.

Until confidence returns, the economy will keep sliding – the Government needs to address the fundamentals rather than just tinker.

Aaron Turner, CEO Look4aProperty