So Chancellor Philip Hammond has delivered his second budget earlier today and urged the UK to “Seize the opportunities” from Brexit, whatever they may be exactly! And he has also promised to tackle deep-seated economic challenges “head on”. We must wish him the very best of luck
Looking at the Budget from a housing market perspective and our Cheadle and Stockport area in particular, the obvious headline which will grab all the attention is the immediate abolishment of Stamp Duty for first-time buyers on property purchases up to £300,000. To help those in London and other more expensive areas, the first £300,000 of a £500,000 purchase will be exempt from Stamp Duty, with the remaining £200,000 levied at 5%.
Obviously this is good news for over 80% of first time buyers and must be welcomed as it hopefully will add some momentum to an increasingly uncertain market, however, unless the supply of property coming to the market improves significantly, all this latest initiative will do is increase demand and push prices up, thus negating the Stamp Duty saving!
More needed for the over 65’s
Personally, I would also like to have seen the government go further and look at ways to incentivize the over 65’s generation to move and downsize by creating more and better value retirement homes. We are an ageing population and the government should be addressing this as well, which seems to be constantly overlooked.
One of the biggest problems currently facing the Government is the lack of new homes being built, especially with an affordable low-cost element. Successive Governments have spouted rhetoric, yet done precious little about it and have failed to meet projected annual house building targets since 1969! Therefore Mr Hammond’s bold statement today and pledge of £44bn in Government support to meet a target of 300,000 new homes a year by the middle of the next decade must be taken with a hint of scepticism, but similarly with the hope that this time a government will deliver.
More Brownfield and Greenfield sites need to be released for development
I also noticed he has pledged £400m to regenerate housing estates and £1.1bn to unlock “strategic sites” for development, something I have been calling for, for some time now. There are numerous Brownfield and Greenfield sites that need to be re-categorized to allow development and actually encourage builders to build out developments rather than just land bank sites for years. Builders must also be incentivized to include a range of affordable schemes to get the market really moving.
Naturally we will all have to wait and see what impact, if any the overall budget has, but generally it would seem an ok budget, not overly creative but certainly one that will be generally welcomed by the housing market, but it still falls short on a number of key areas, which remains a concern.