By Jeremy Gates, PA Features

Although it may not have been his original intention, the first Pre-Budget Report from Chancellor Alistair Darling could significantly boost the housing market in the medium term, if not necessarily overnight.

Although it may not have been his original intention, the first Pre-Budget Report from Chancellor Alistair Darling could significantly boost the housing market in the medium term, if not necessarily overnight.

Charges to inheritance tax (IHT) and capital gains tax (CGT) could see millions more pounds being recycled in the market - possibly turbo-charging the holiday home market at home and abroad.

It has been estimated that 2.4m homes across Britain worth between £300,000 and £600,000 will fall out of the IHT net because of Mr Darling's package.

Much of the money saved by better-off families can be expected to find its way back into bricks and mortar.

By 2010, the lifting of the IHT limit to £700,000 per couple could enable many couples - if they take skilled advice - to shelter the best part of £1m from IHT by using trusts.

In areas of high property values, much more money might pass to children than before.

Anybody with a home-owning Granny in Brighton who looks a little peaky, for instance, might occasionally be tempted to think about hard cash. Figures from the website Email4Property.co.uk show the average price of a home in the fashionable South Coast town has zoomed to £251,400, with detached houses averaging just under £400,000 and a top price so far achieved in 2007 of £1.52m.

By contrast, people inheriting from elderly homeowners in cheaper areas will benefit less from Mr Darling's generosity - and children of those in tenanted housing will get even less. Many, particularly Labour left wingers, must be spitting tacks at this prospect.

Lucian Cooke, Director of Research at leading London and country agents Savills, has studied IHT receipts in the decade from 1996 to 2006: he thinks sales of the family home generated £228m for Government coffers in 1996 and a stunning £1.42bn by 2006.

These figures make it hard to accept Government figures that only a tiny minority was caught in the IHT trap.

However, it is generally argued - certainly by the Tories who wanted an IHT threshold set even higher - that larger inheritances mean more money being ploughed back into property, either by first-time buyers or by older couples buying second homes for leisure or investment purposes.

Many families into middle age (30/40s) are not always keen to move when parents die, so they might put their cash windfalls into up-and-coming seaside spots for holiday homes. Happy inheritors back in the 1990s, I fancy, helped to turn Whitstable on the Kent coast - so near to London - into a property hotspot.

So far as the investment or Buy-to-Let market is concerned, the mechanics of Mr Darling's Pre-Budget Report are a little different.

Different experts have different views on where the investment market goes from here:

:: Henry Pryor, founder of the website Primemove.com: "CGT changes are a shot in the arm to investors and armchair Sarah Beeny fans. If they sell their property after next April, they will not only have to pay 18% on any capital gain they have made.

"I predict a rush of property being marketed after April 6, 2008 as people dump their investments and cut losses in what could by then be a falling market."

:: Jonathan Moore at specialist broker Mortgages for Business: "Many buy-to-let investors and second home owners face a minimum CGT rate of 24% on profits when they sell. The new 18% rate means a tax cut for many.

"It's a particularly big break for investors of less than three years standing. Their effective tax rate, after April 6, is more than halved from 40% to 18%."

:: Stuart Law of investment company Assetz: "Before investors across the UK rush out to vote Labour, I should point out this change in tax was an accident because Mr Darling wanted to target private equity tax leakage. As usual, his rushed policy had unintended consequences."

In their different ways, each of these experts reflects the fact that many investors feel Mr Darling has given them a break.

All this represents a surprise turnabout in the fortunes of buy-to-let investors, given the recent clamour - remarkably joined by the Institute of Directors - calling for them to lose the right to charge mortgage interest as an allowable expense against rental income.

Suddenly, like the England Rugby team, investors are back in the sunlight again, after long months as everybody's whipping boy.

Will Mr Darling really persuade many investors to "take the money and run?"

ARLA, the Association for Residential Letting Agents, repeatedly tells us that most landlords are in "for the long haul". I suspect Mr Darling's apparent largesse could put this to the test over the next 18 months.

:: ARE HIPs WEAKENING THE HOUSING MARKET?

It's ten weeks since the introduction of Home Information Packs - initially on four bedroom homes from August 1, followed by three bedroom homes in September. And controversy about whether or not they have paralysed the housing market is as fierce as ever.

Nobody disputes that housing market turnover and the supply of homes for sale are both falling. And the fall seems more marked among larger homes which now fall within the HIPs remit.

Says Jeremy Leaf, spokesman for the Royal Institution of Chartered Surveyors (RICS): "Although they are not the only factor, HIPs continue to have a detrimental effect on the housing market, despite assurances from the Housing Minister this would not happen.

"With fewer family properties for sale in September, buyers looking to upgrade to larger properties are finding it increasingly difficult to choose from declining supply."

Naturally Mike Ockenden, Director General of the Association of Home Information Pack Providers (AHIPP) takes a different view.

"It is clear a multitude of factors have caused the housing market to slow, many of them affecting buyers coming to the market", he says. "Interest rates have gone up three times this year. There have also been devastating floods, the first run on a bank in living memory and the credit crunch has also hit sentiment.

"Some of the largest estate agents in the country (who are members of AHIPP) tell us that HIPs are not the cause of problems in today's housing market."

However, some of the new companies which have sprung up to supply HIPs packs to homeowners see things slightly differently: they believe HIPs, even when legally required, are being wilfully ignored by some agents and their vendor clients.

Says Jeff Smith, chief executive at HIP Payment Services, which offers various deferred payment schemes which allow vendors to pay their HIP when their home is eventually sold, claims: "There is a remarkable lot of skulduggery going on out there in the housing market."

Mr Smith remains baffled that HIPs aroused such criticism: "For an average HIP cost of about £400, which is fairly insignificant against all other costs of moving, why wouldn't homebuyers welcome as much information as possible about a property before they start serious negotiations?" he says.

"With the average agent's bill coming in around £4,000, why is the cost of a HIP a matter of concern?"

Apparently some AHIPP members are convinced that demand for HIPs from vendors of three and four bedroom homes is running at surprisingly low levels: in August, for instance, the number of homes listed plunged dramatically from an expected 120,000 to 80,000. Barely 20,000 HIPs were compiled.

September, too, is believed to have seen little more than 20,000 HIPs compiled. These figures are uncomfortably low for as many of the 30,000 people believed to have undergone training for new careers in the HIPs business.

AHIPP members believe agents may be advising vendors there is no need to get a HIP if their property was listed with another agent prior to the August 1 deadline.

But Trevor Kent, a Gerrards Cross-based estate agent and long-term opponent of HIPs, is mortified at suggestions that his fellow agents could be breaking the law.

"If estate agents faced an inspection by Trading Standards Officers, and were unable to prove properties on their books were not previously listed with another agent before August 1, they could find themselves open to prosecution.

"I cannot believe many agents are prepared to take that risk", he says.

Jeff Smith predicts the key test for HIPs - and for Government resolve in bringing them in - will really come in January.

By then, Housing Minister Yvette Cooper should have crossed the Rubicon by bringing smaller one and two bedroom home within the HIPs remit - and agents will not be able to claim that many homes on their books really were available with another agent earlier in 2007.

Mr Smith says it is "disgraceful" for Tories to commit themselves to scrapping HIPs as soon as possible, hitting many people who have given up previous jobs and committed four figure sums to training courses to administer the HIPs system.

"We say it is essential for HIPs to be made compulsory on homes with one and two bedrooms from November 8.

"It will save an awful lot of pain, and people who have begun new careers in this sector will at least know the cavalry is on its way to rescue them."

Housing Minister Ms Cooper has to balance this request with warnings that a slowing market cannot take more regulations and bureaucracy.

She must also be concerned at the prediction that around 7,000 Home Inspectors and Domestic Energy Assessors will have completed training by November and will be raring to go. Many will have paid out several thousand pounds to prepare for a new career.

But Trevor Kent retains his implacable prediction that HIPs will be scrapped - not least, he claims, because some solicitors are telling clients that they won't read the HIP report on their behalf unless they can charge clients an additional £250 for the extra work.

Says Mr Kent: "Purchasers readily make offers without even seeing their HIP, and solicitors have no trust in them. Slowly, the penny will drop that they don't bring anything important to the party - but Housing Minister Yvette Cooper may have little option but to bring them in for one and two bedroom homes."

Meanwhile, figures released by LMS, one of the largest HIP providers and a leading provider of outsourced conveyancing, claims the number of days it takes to sell a property - from going on sale to exchange of contracts - fell in the third quarter from 53 days to 49, proving the efficiency of the new system.

:: INFORMATION: Details of HIP Payment Services are available online at www.hippayment.com

:: PROPERTY SHORTAGES TRIGGER SHOCK SEPTEMBER RISES

Many buyers who keep searching for property in the weeks up to Christmas could well be rewarded with a bargain, says a leading analysis of the market.

Rightmove, which claims to be the UK's leading property website, says house prices were subject to wide regional variations during September.

Big rises in Greater London (up 5%), South East (up 4.7%), South West (up 3.5%) and East Anglia (up 3%) were balanced by tiny rises elsewhere in East Midlands (up 0.6%) West Midlands (up 0.1%), Yorkshire & Humberside (up 0.3%) and North West (up 1.5%) and even falls in Wales (minus 1.3%).

Rightmove commercial director Miles Shipside thinks the distortion of markets caused by the introduction of HIPs is a key influence: for instance, fewer three bedroom homes went on the market in the South, and that caused prices to spike upwards.

Says Mr Shipside: "When one and two bedroom properties hit their own HIP deadline, we expect to see a price fall of up to 5% in a month, driven by the same distorting effect, which will then be largely reversed in the following month."