A Housing Boost for Cambridge?
One of the key takeaways from the Spring Statement is the government’s commitment to increasing housebuilding. With a target of 1.5 million new homes by 2030, there is an emphasis on addressing the ongoing housing shortage, particularly in high-demand areas such as Cambridge.
However, planning constraints and the city's unique heritage mean that large-scale development isn’t straightforward. While the nearby areas of Waterbeach and Northstowe are already seeing significant expansion, the challenge remains in balancing growth with preserving Cambridge’s historic charm and green spaces. If planning approvals accelerate, we could see more new-build developments, which may help stabilise property prices in the longer term.
Stamp Duty Changes and Cambridge Buyers
A major talking point has been the upcoming stamp duty changes, set to take effect on April 1st. The threshold for first-time buyers will drop from £425,000 to £300,000, and for other buyers, it will decrease from £250,000 to £125,000.
In Cambridge, where the average first-time buyer property price sits around £430,000, this means many will now face additional costs when purchasing their first home. Buyers who were hoping to benefit from the higher threshold are now rushing to complete their purchases before the new rates come into play. For those buying after April, factoring in additional stamp duty costs will be crucial.
Rental Market Pressures Continue
Cambridge has long been known for its high rental prices, and the latest figures show that rents have risen by 8% in the past year. With demand still outstripping supply, particularly in central areas close to the university and biomedical campuses, landlords may see continued strong returns on investment.
However, new government measures could impact landlords. While no major tax increases were announced, there is growing speculation about further restrictions on short-term lets and incentives to encourage long-term rentals. If implemented, this could affect those investing in buy-to-let properties or short-term accommodation for students and professionals.
Mortgage Rates and Market Confidence
The Spring Statement also addressed the wider economic outlook, which in turn impacts mortgage rates. While inflation is expected to continue falling, interest rates remain higher than in previous years. For those looking to remortgage or take out a new mortgage in Cambridge, rates hovering around 4.5-4.7% mean affordability remains a concern.
However, confidence in the Cambridge market remains strong. With its reputation as a global centre for education, technology, and research, demand for property here is unlikely to diminish significantly. Buyers and investors alike should keep an eye on any future announcements regarding incentives or support for homebuyers.
What’s Next for Cambridge’s Property Market?
The Spring Statement brings both challenges and opportunities for Cambridge’s property market. While housing supply may increase in the coming years, affordability concerns persist, particularly for first-time buyers facing higher stamp duty costs.
For those considering buying or selling in Cambridge, the next few months will be crucial. If you're thinking of making a move, getting expert advice and understanding how these changes affect your specific situation will be key to navigating the market effectively.
At Hockeys Estate Agents, we're here to help you stay informed and make the best property decisions in Cambridge. Get in touch with our team today for personalised advice on buying, selling, or investing in the local market.
10 Mill Road, Cambridge CB1 2AD