INDUSTRY NEWS 5
Wide-ranging housing package announced in Budget
The Chancellor of the Exchequer Philip Hammond delivered his Autumn Budget with a package of measures intended to address what he said was the “challenge of the housing market.” A key measure in his speech was cutting
stamp duty for all house purchases up to £300,000, and for the first £300,000 of properties valued at up to £500,000. Commentators have questioned whether this will simply have the effect of raising prices rather than the intention of helping first-time buyers. Hammond announced £44bn of capital
funding, loans and guarantees for housing over the next five years, with a further £8bn of financial guarantees in place to support private housebuilders and the purpose-built private rent sector. As well as £1.5bn targeted at SMEs via extending the Home Builders Fund, £1.1bn will be allocated to “unlocking” strategic sites, including new settlements and urban regeneration schemes. These would be developments “where most people want to live, and where jobs are created.” He said this was the “best use of land” and would avoid building on the green belt. The Chancellor also committed to
reform planning, “to make the best use of urban land, and continue the strong protection of the Green Belt.” He announced a review, chaired by MP Oliver Letwin, which will identify reasons for the “gap between planning permissions and housing starts”.
The powers of the Homes and Communities Agency will be expanded within a rebranded agency called Homes England, “bringing together money, expertise, planning and purchase powers to facilitate sustained affordability.” This will include powers to compulsory- purchase sites which already have planning permission but which have not been built on.
The Chancellor announced that a further £10bn of Help to Buy loans would be provided, and that the Housing
Infrastructure Fund would be increased by over 50 per cent, to £2.7bn. £28m will be allocated to those affected
by the Grenfell Tower disaster, including funds for mental health aid and counselling, and a new community space. Hammond urged all local authorities to
carry out any identified, necessary safety work as soon as possible. “If they can’t afford it, they should contact us immediately,” he said. “We will not allow financial constraints to get in the way of any essential fire safety work.” On the subject of empty homes,
Hammond said: “It cannot be right to leave property empty, when so many are desperate for a place to live.” He therefore announced that councils will have the power to charge a 100 per cent council tax premium on empty properties. A total of £28m will be allocated to three
new housing pilots and a homelessness taskforce, as part of the Government’s commitment to half rough sleeping by 2022, and eliminate it by 2027.
INDUSTRY REACTS The construction industry offered a general welcome to Hammond’s Budget speech. Many lauded the “long-awaited” attention given to housing, but some criti- cised its “predictability” and noted key elements that were absent. Chief executive of the FMB Brian Berry,
with a few caveats, was pleased that SMEs were specifically addressed: “The Government has set itself a new target of building 300,000 new homes a year by the mid-2020s. And today the Chancellor has put small and medium-sized builders at the heart of ambitious plans to tackle the growing housing crisis.” He added: “The Chancellor appears
to be putting his money where his mouth is. In particular, the £1.5bn targeted specifically at SME housebuilders can play a significant role in channelling crucial funding to this sector. In addition the £63m to prepare small sites for develop-
ment and proposals to require councils to deliver more new housing supply from faster-to-build smaller sites will provide opportunities to boost small scale development.” Berry also welcomed action on skills, in
the context of Brexit concerns: “We are therefore pleased to hear the Chancellor has committed extra resourcing to training for construction skills. With Brexit round the corner, the next few years will bring unprecedented challenges to the sector. The Government will need to make sure that the sector continues to have access to skilled EU workers, but we are pleased that the Chancellor has today listened to the needs of SME builders.” Henry Fordham of Bellis Homes
welcomed the abolition of stamp duty for first time buyers, but thought Hammond could have gone further. “We are pleased to see widespread reform and investment in the UK housing market. Abolishing stamp duty for first time buyers is a positive step, but being limited to £300,000 means its impact is minimised in many areas where many young professionals are required to work and live, such as London and linked commuting areas. “He should have committed to
considering a temporary stamp duty holiday. Such a measure would have ensured the most immediate catalyst across the market and country as a whole to the benefit of the economy.” Ben Kite, managing director of
‘ecological consultancy’ EPR, criticised the lack of reform regarding the green belt: “Perhaps contrary to popular belief, the Budget’s apparent neglect to consider providing means to revisit the extent of land included within the green belt is a blow for ecologists as much as for developers. The budget should have set aside funds to assist with the implementa- tion of sensitive housing development projects on carefully selected sites within the green belt. Such projects, incorporating generous green infrastructure, would have
THE CHANCELLOR ANNOUNCED A REVIEW, CHAIRED BY OLIVER LETWIN MP, WHICH WILL IDENTIFY REASONS FOR THE “GAP BETWEEN PLANNING PERMISSIONS AND HOUSING DEVELOPMENT STARTS”
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