Autumn Budget 2021: Property Sector Funding Update [UPDATED]

Chancellor Rishi Sunak announced today the Autumn Budget. The focus on the property sector was almost exclusively aimed at boosting investment for housebuilders and redevelopment, including further investment for the removal of hazardous high-rise cladding.

High-profile issues surrounding Stamp Duty, Inheritance Tax and Capital Gains Tax were absent during the actual announcement, but the devil is usually in the detail of the published Budget, so if we uncover anything, we’ll be sure to update you here.

Note: Capital Gains Tax did receive some love – we’ve updated with details below.

New Homes: Affordable Housing Investment & Redevelopment

Mr Sunak is promising a multi-year housing investment of £24 billion, including £11.5 billion towards building 180k affordable new homes.

He also announced a further £1.8 billion to develop brownfield sites across the UK, with the potential to build 160,000 new homes.

Both these measures are the Government’s answer for helping to stabilise the housing stock crisis, largely impacted by the halts in output caused by lockdowns throughout the pandemic.

Max Harbron, Head of New Homes commented on the new build funding announcements:

“Demand for New Homes in and around the Worthing area, and the South East in general, remains at an all-time unprecedented high. At Michael Jones we are fortunate to be at the forefront of a huge range of New Home developments and work hand in hand with the area’s most prolific developers.

We are encouraged by the Government’s continued drive to provide high quality new homes and look forward to delivering these on behalf of our clients for many years to come.”

Removal of unsafe cladding

Long campaigned for in response to the tragic events at Grenfell Tower in 2017, the Chancellor also announced £5 billion to remove unsafe cladding from high-risk high rise residential buildings.

This sum is said to be funded in part by the Residential Property Developers Tax, levied on housing developers at a rate of 4% with profits over £25 million.

Boost to England’s planning system

Aiming to accelerate planning system changes made last year, Mr Sunak has announced £65 million to boost England’s planning system.

He also revealed that the system would also be modernised by converting it all to digital, thereby making local plans faster and more convenient to access. 

Business rates and green investment relief

Business rates received attention too. Revaluations will now occur every 3 years from 2023, with the hope of creating a fairer system and “stronger High Streets”.

A new 50% business rate discount for retail, hospitality and leisure sectors could save a business up to a maximum of £110,000 over the course of one year.

Green measures are being encouraged too, with investment relief available for companies who adopt energy-efficient changes.

Business rate changes are welcome news to our Lettings Director, Jon Justice. Here’s his view:

“The support announced for Businesses today by the Chancellor will assist in regenerating High Streets across Britain. Locally, Montague Street (the main shopping street within Worthing) was hit hard during the Pandemic with occupiers like Thorntons, Brighthouse, Debenhams, Beales, Dorothy Perkins and Laura Ashley vacating large properties in the street.

One of the constant challenges in re-letting these spaces is the costs associated with Business Rates. So yes, we’re extremely encouraged to hear of the Government’s plans to offer a 50% rates discount to new and existing businesses within the hospitality and leisure sectors.”

[UPDATE] Capital Gains Tax reporting time doubled for landlords

Though a small change by comparison to the above announcements, the Chancellor has doubled the previous 30 day tax return window to 60 days. This will be a welcome amendment for anyone selling a UK residential property, including landlords. Best of all, it’s already come into effect, so you can breathe a little easier.

 


If you have any questions about how the new Budget affects you as a buyer or seller, please feel free to get in touch with us at your local Michael Jones office.


Content accurate at time of publishing.

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