Wednesday saw the release of the long-awaited Autumn Statement from Phillip Hammond, Chancellor of the Exchequer.
Hammond’s measures plan to have a large impact on the property market, including measures to increase capital for housebuilding, accelerate housebuilding on public sector land and prevent the implementation of Pay to Stay for higher-paid council tenants.
Here are some key points regarding the property market we have taken away from the Statement:
£1.4 billion is being set aside to deliver 40,000 affordable homes
Whilst many property experts are arguing that 40,000 homes are not nearly enough, it is definitely a step towards helping first-time buyers attempting to save for a deposit.
The chief executive of thinktank Localis, Liam Booth-Smith, welcomed this announcement:
“While the cash figure will get the headline, the bigger change is that the grant funding will come with fewer strings attached than previously,” he said.
“Bidders will be able to use it to build homes for affordable rent, not just shared ownership and rent to buy.”
Mark Hayward, managing director of the National Association of Estate Agents, believes this was just a dent in the solution.
“The measures announced to boost house-building go some way to making the housing market work for everyone, but quite frankly do not go far enough,”
“The detail in the housing white paper will be crucial – let’s hope there are far more detailed plans in there when it is released,” he added.
Letting agents’ fees will be banned “as soon as possible”
This is a much welcome move for renters, who pay on average £223 worth of fees – according to the latest English Housing Survey.
Letting agents are protesting these plans and say the loss of income will simply be passed on in higher costs for landlords, who will then in turn pass it on to tenants through higher rents.
However Stephen Smith from Legal & General Housing Partnerships says:
“The implementation of this policy in Scotland in 2012 does not seem to have had a negative impact either on rents or on the availability of private rented accommodation.”
£3.15 billion is being set aside for 90,000 new houses in London by 2020
The Chancellor made clear in his statement that London remains a priority in getting a fair share of the affordable housing budget.
Money will be used for housing tenures including those with below-market rents for low-income earners, and homes with rents set at no more than a third of average local income for middle-income earners.
Mark Boleat, policy chairman at the City of London Corporation, said:
“A commitment to increase the amount of affordable housing in the capital is a great step forward. The £3.15 billion over the next five years will go some way in alleviating a problem which seriously undermines our position as a leading global city.
“Too many workers in London face problems in finding affordable and suitable housing. Unless we take steps to tackle this problem then it simply drives workers away from London and benefits other leading financial centres, particularly those across Europe.”
For more points from Hammond’s Autumn statement, click here.