BUDGET REPORT
Moving and shaking, homes and housing
Now the dust has settled, T
he Chancellor was on his feet for just less than one hour, but in that time he announced a small series of radical changes in legislation and taxation that,
while initially a little underwhelming, may well have profound effects on the UK housing market: A presumption in favour of development,
including the ability to change the use of a building from a shop, office or commercial building to residential. A consultation on changes to REITS (real estate investment trusts) that will allow investment in residential property, reducing regulation and lowering barriers to entry; such as permitting AIM registered companies to invest and pools of investors to club together to form new REITS. Real encouragement to pension funds and insurance companies to invest in residential. Stamp duty on bulk purchases of properties will be reduced to duty on the average (rather than aggregate) price only, subject to a minimum of one per cent. The headline news of equity loans to
10,000 first time buyers who wish to buy homes in shared equity schemes is small beer by comparison. It may take two to three years for these major changes to work through to the market and there is a conflict with the idea of localism whereby local communities can decide what is built and where in their own neighbourhood.
REFORMS Commentators in the national press have not been kind to the Chancellor nor have they tried to work out what the Welfare Reform Bill will do to social housing organisations, their tenants and to landlords or tenants in the private sector. This Bill was presented to Parliament on 16 February, the second reading took place early in February and the committee stage, a detailed line by line examination, began on 22 March.
’s
Practitioner reviews the implications of the Budget and other recent announcements
Underwhelming? George Osborne’s Budget was rapid and radical – in part.
Commentators in the national press haven’t been kind to the Chancellor.’
From October 2013 one Universal Credit
will replace all in work and out of work benefits including housing benefit with a single payment. The government will set Local Housing Allowance (LHA) rates without reference to the Rent Officer Service. Rises will be limited to changes in the Consumer Prices Index. Out of work benefits will be capped at the estimated average earnings of working households, about £500 per week for couples and single
parents and £350 for single persons. A significant number of claimants will therefore have the largest element of benefits reduced, losing an average of £93 per week according to the government impact assessment. Size criteria will be introduced for working age claimants in the social sector, reducing the Universal Credit if the house is larger than necessary. Since the Universal Credit is to be paid direct to beneficiaries there is a risk that
PROPERTYdrum MAY 2011 27
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68