There was the predictable populist attack on bankers, energy firms and oil company profits – but what did the UK budget offer for the property industry. I feel it touched on a multitude of issues: there were some progressive components (new REIT legislation & SDLT reform in particular!), but overall it was thin on the ground in terms of market moving announcements.
The only ‘moving’ that might happen, is a speedy rush to be one of the select first-time buyers to benefit from the government allocation of £250m in equity to support the purchase of a new-build home. You can see the logic behind the FirstBuy scheme – help those looking to get on the ladder, whilst simultaneously supporting the housebuilding industry. It’s only a shame that estimates suggest the policy will benefit fewer than 15,000 households (based on today’s average house price), representing at best 2% of all housing transactions across the UK last year.
Sadly, reforms to the planning system still lack clarity, there was more rhetoric around ‘localising choice’, ‘streamlining’ planning applications, and the government will ‘consult’ on proposals to convert unviable commercial space to residential.
The announced Enterprise Zones offer a prime example of the give and take of this neutral budget. Private enterprise is being tempted with a 100% discount on rates, UKTI inward investment and long-term TIF support, and it comes as no surprise to see the very clear Midlands and Northern focus. Questions arise as to where occupier demand will come from, will it simply be the relocation of nearby firms ‘inside the zone’ or will it engender ‘new’ jobs. For those 21 communities across the UK crying out to be designated an enterprise zone this is good news… you perhaps just don’t want to be their immediate neighbour.
It’s now a waiting game to see how effectively these Budget policies, and other property measures, play out.