Jeremy Hunt will face some rather tough challenges when he delivers his first Budget tomorrow.
The chancellor will attempt to address rising inflation and the cost-of-living crisis, while he also faces calls from the housing industry to help ease the chronic shortage of homes nationwide.
The government is likely to fall well short of its ambition to build 300,000 homes a year, prompting Jeremy Leaf, north London estate agent and a former RICS residential chairman, to make this plea: “We’re told the Budget will be boring, so are not expecting any fireworks for the housing market.
“I would like to ask Jeremy Hunt, apart from trying to stabilise the economy and ease the cost-of-living crisis, please do something to increase the supply of good quality, energy-efficient homes to rent and buy. Greater availability of these will keep longer-term rents and prices in check so we don’t want the Chancellor to do anything which may reduce, or compromise, present activity levels.
“More specifically, we want to see greater encouragement of aspiring first-time buyers which would reduce the number renewing rental contracts and release much-needed stock, as well as softening rents and improving standards. Increased buyer/seller, landlord/tenant activity is not only good for the property industry but for the rest of the economy as well, due to its positive ‘multiplier’ impact on so many other businesses.
“We would like to see landlords incentivised, perhaps with nil-rate VAT to help them meet energy efficiency standards as part of a drive towards more retro-fitting and net zero, provided tenants can be accommodated while works are in progress. More needs to be done to encourage buy-to-let landlords to stay invested and reduce the number who are leaving the sector. Perhaps this could be achieved by re-introducing mortgage interest tax relief and re-adjusting stamp duty thresholds to coincide with the Rental Reform Bill becoming law.
“Easing planning restrictions, particularly for SME builders on smaller sites, would increase delivery and specifically improve first-time buyer accessibility. Introducing a Help to Buy replacement for first-time buyers, which is not regarded as ‘Help to Sell’ by developers, would also be beneficial.
“Encouraging downsizing into right-sizing, with higher penalties for leaving land or buildings empty, will ensure we make better use of the accommodation we already have. Expediting the council tax revaluation so we’re all paying our fair share with higher charges for second homes used for holiday purposes, would raise additional funds. While local authorities can charge extra now, many still offer discounts despite double assessments in some areas and proposal for triple in Wales.”
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