With the 2017 Autumn Budget being released tomorrow – the main focus is expected to solve the UK’s housing crisis…
Theresa May hinted at policies changing to cater for the Uk’s housing crisis – she made it her ‘personal mission’ to “build more houses.” Even the Communities Secretary, Sajid Javid said he will wipe housing associations debt off the balance sheet.
Well here’s our verdict on tomorrow’s Autumn Budget 2017:
Rethink: stamp duty
With the pressure ramping up on the government to give a helping hand to younger voters, this is a no-brainer. Abolishing stamp duty for first-time buyers will making it easier for them to climb the first rung on the housing ladder by combating unreasonably high house prices. However, the Adam Smith Institute has called for stamp duty to be scrapped altogether, which is less likely.
Although, landlords should watch out: it’s thought the new rule will be financed by an increase in stamp duty for buy-to-let properties.
Green belt and planning rules
It is a truth universally acknowledged that a housebuilder in possession of a good fortune must be in want of more space to build on – thus, complaints about planning rules and the government hogging land are almost always at the top of housebuilders’ Budget wishlists.
This time, though, it looks as though they may be about to get what they want: Hammond is said to be considering reclassifying parts of the green belt as part of a radical reform to planning rules. “This move would be attractive in that it would cost the chancellor nothing,” said Howard Archer, chief economic adviser at the EY Item Club.
Borrowing rules for councils
Under the Housing Revenue Account Borrowing cap, introduced to limit government debt, local councils are currently not allowed to borrow to build homes. But 21 London boroughs and the London Mayor have followed up calls from the London Chamber of Commerce and Industry (LCCI) for local councils to be given the freedom to invest in new council housing.
In a letter today, Khan said: “We want to build more affordable homes, including new council housing – and Londoners are desperate for us to do so. But we urgently need government to play its part by giving the capital the resources, powers, and freedoms we need to underpin a step change in what we can do.”
Help to Buy
The Prime Minister has already said the government will put another £10bn into the Help to Buy scheme, which provides first-time buyers with cash to buy a new-build home. Hammond is expected to shed more light on the government’s plans.
Probably not: borrowing £50bn to build
Things were looking up for housebuilders in October when Javid suggested the government should take advantage of low interest rates by borrowing £50bn to build more homes. But that idea was quickly quashed by Hammond, who said: “It is not responsible to make so-called hard choices by loading the price on to the next generation and the generation after that.” So don’t expect that to receive a mention on Wednesday.