On October 29th 2018, the Rt Hon Philip Hammond MP delivered his 2018 Budget speech. He announced the minimum living wage would be rising, the tax-free personal allowance would increase, and fuel duty will be frozen for the ninth consecutive year. There were also pertinent updates for the property sector.

Encouraging the Construction of Property

The statement read: “The government is determined to fix the broken housing market. Building more homes in the right places is critical to unlocking productivity growth and making houses more affordable.”

Hammond injected £500m for the Housing Infrastructure Fund to tackle the housing crisis by enabling a further 650,000 homes to be built. Also, new partnerships with housing associations in England are set to deliver 13,000 homes with £653million investment, and guarantees have been made for up to £1billion for smaller house-builders.

The borrowing cap will also be lifted on local authorities in England on 29th October 2018, so they can borrow more to build housing. It is hoped this will increase the build total by 10,000 homes per year and therefore is also being considered in Wales.

Helping First Time Buyers onto the Ladder

The Chancellor announced that soon all first-time buyers purchasing shared equity homes of up to £500,000 will be eligible for first time buyers’ relief from Stamp Duty Land Tax.

From April 2021, a new Help to Buy Equity Loan scheme will be introduced which will run for 2 years. This scheme will be available for first time buyers only and will only be on properties up to a set regional value. Once this scheme ends in March 2023, the government does not intend on running future Help to Buy Equity Loan schemes.

There will also be some relief for lettings where the owner of a property is in shared occupancy with the tenant.

Redevelopment of Unused Land

Last, but not least, the government has pledged £50million for planting trees in England and a further £10million to deal with abandoned waste sites. The National Planning Policy Framework has been revised, implementing 85 of the proposals set out in the Housing White Paper and Autumn Budget 2017 in a bid to ensure that more land in the right places is available for housing.

The government also launched a consultation into new permitted development rights, where extensions above commercial buildings can be demolished and replaced with homes.

So, What Does All of This Mean for You?

Well, with more people than ever before being able to get on the property ladder, properties should sell faster – so don’t be surprised to see stagnation in property prices. Furthermore, with caps lifted on local authorities and encouragement to build on wasteland, there will likely be more opportunities to build large projects in up-and-coming areas.

Lastly, if successful, the changes to permitted development rights could save you considerable time, energy, and money should you decide to redevelop and expand a property to add value. Should this be something you’d like to do, our permitted development finance brokers are on hand to find you a great deal.

 

Read more:
Everything You Need-to-Know About Building on Brownfield Sites
Are Abandoned Properties a Good Opportunity for Developers?
What is Land Transaction Tax and What Does It Mean for Developers?