The chancellor delivered his Autumn Statement today, with many in the housebuilding industry hoping for a focus on addressing the key issues that impact housing and buyers.
Jeremy Hunt’s speech came with a negative backdrop as the Office for Budget Responsibility (OBR) announced that it was now forecasting a much slower rate of growth for the UK economy. The OBR is now forecasting 0.7% growth in 2024 and 1.4% in 2025, scaled down from its earlier forecast in March of 1.8% and 2.5% respectively.
The headline news from the Autumn Statement was a reduction in National Insurance rate, benefits and minimum wage to go up and tax breaks for businesses, while for the housing industry, the biggest takeaways were the announcement of nutrient mitigation schemes to boost new homes, a £3billion extension to the affordable homes guarantee scheme, £450million pledged to the local authority housing fund to create almost 2,500 homes and a commitment to reforming the planning system from 2024 to deliver guaranteed timescales.
Here’s how the Autumn Statement was received across the industry:
Mark Booth, co-founder of Hayfield, said: “The Tories had lost the initiative on planning reform to Labour after its conference announcements. Today’s Autumn Statement showed that it is at least beginning to get to grips with the issue. But we need to see much more as we get closer to the election to prove that it is serious about unlocking development and boosting our anaemic economic growth.”
David Cracklen, director of AJC Group, said: “With the current challenges facing the housing industry, and especially SME housebuilders, we would’ve hoped to have seen more support announced in the budget.”
“The UK is experiencing an unprecedented housing crisis and shortage of affordable homes. Changes to Stamp Duty Land Tax (SDLT) would have potentially helped those in a position to buy, however for the growing number of those who require affordable housing, this would not have the desired effect. What needs to happen is reforms to the planning system, in order to enable housebuilders across the board, and especially SMEs, to increase their output. The £32million that the government has pledged to speed up planning only applies to London, Cambridge and Leeds, there needs to be support provided across the country.”
“Costs for submitting planning applications are already at an all-time high and are set to rise by 35% by the end of the year. This, added to the already challenging cash flow pressures, many housebuilders will be lucky to make it through the year. As highlighted in the ten-step plan by the HBF, if the costs of planning are going to be increased, there needs to be more resources available to make it worthwhile and justified, otherwise the government will risk wiping out the SME housebuilders altogether.”
Marc Vlessing, chief executive of Pocket Living, said: “With nearly 25% of young Londoners openly admitting in our recent research that they will be forced out of the capital due to high housing costs, the lack of affirmative action to support SME developers and get builders building in today’s Autumn Statement is palpable.”
“According to the latest data, construction starts in London are at the lowest point since 2009. Consequently, the industry is in dire need of support. Considering the chancellor’s focus on supply-side measures, this was an ideal chance to provide this backing as well as be radical and listen to those 66% of Londoners aged 25-45 who would have welcomed development on the green belt if it meant more homes. As a representative of the SME sector, it is therefore disheartening to see our suggestions for supply-side interventions—proposals that could potentially unlock an additional 1.6 million new homes, at no extra cost to the treasury —overlooked once more.”
Rayna Hunter, CEO of LH1 Global, commented: “Following a somewhat disappointing Budget earlier in the year, with little to no focus on the property market, we wanted to see more direct initiatives to support the sector. However, the measures to support people with the cost of living will have a positive impact on the market, so that was good to see.”
“We do feel that there needs to be a strong move to support first-time buyers, either in the form of reintroducing Help to Buy or something similar that will ease the cost of buying a home, as well as reducing some of the taxes and levies on purchasing a home both for domestic and international buyers. This will undoubtedly lead to a boom in sales and make the UK a very attractive proposition for international investors once more, whilst also encouraging domestic purchasers to enter the second home market once more. We get the feeling this will be a key part of the next Budget and perhaps even a lead pledge ahead of any future election.”
Brian Comer, chairman of Comer Homes Group, said: “It is encouraging to see the initiatives announced in today’s Autumn Statement that will ease the cost of living for many across the country. Rising interest rates, inflation and general costs have had an impact on the property market, so these measures will provide at least some respite and hopefully inject some more impetus and increase activity.”
“We would like to have seen property-related taxes and incentives addressed more directly, as a healthy property market can be the building blocks for a strong economy, so I’m eager to hear more from the government and the opposition on their plans to encourage more transactions in the future, especially with an election looming. We were certainly encouraged by the Chancellor’s call to speed up planning applications, especially as we look to launch a number of new developments in 2024, which will deliver hundreds of much-needed new homes.”
James Dickens, managing director of Wavensmere Homes, said: “Despite government debt continuing to rise, the chancellor’s Autumn Statement signalled a change in direction, but there was too much flirting around the edges. We were hopeful of a reduction in Corporation Tax and are disappointed this hasn’t been implemented today.”
“As a Birmingham-based housebuilder, we also welcome the Investment Zone announcements for the West and East Midlands, which is where the majority of our live schemes are located. We look forward to seeing how the “mini Canary Wharfs” are to be delivered.”
“Meanwhile, with mandatory housing targets in disarray, there is a significant reduction in the number of attainable homes coming onto the market. It was encouraging to hear the chancellor commit to reform the planning system from next year to deliver faster ‘guaranteed’ timescales in return for higher application fees, which Wavensmere Homes and the industry at large supports.”
“It was disheartening to see the current Stamp Duty thresholds unchanged, as the only real help first-time buyers currently have is the Stamp Duty exemption for homes valued up to £425,000. First-time buyers deserve far more assistance than this to access the housing ladder.”
“Overall we are frustrated with the lack of bold action from the chancellor today and hope for a more confident Spring Budget.”
