In Wednesday’s Spring Statement, the chancellor Philip Hammond announced a new £3bn Affordable Homes Guarantee scheme which he says will deliver around 30,000 new homes.
The government will also unlock £717m from the Housing Infrastructure Fund to deliver up to 37,000 new homes on sites in West London, Cheshire, Didcot, and Cambridge.
Hammond said the scheme will launch next month and will help “restore the dream of homeownership”.
Additionally, the Chancellor announced that new homes will be banned from having fossil fuel heating systems from 2025, “delivering lower carbon, and lower fuel bills too.”
Iain McKenzie, CEO of the Guild of Property Professionals said, “Aside from announcing a new £3bn Affordable Homes Guarantee scheme, the Spring Statement didn’t deliver much for the property market, which was expected given the lack of stability in the political arena and the no-deal Commons vote later today.
“What is needed are measures to improve consumer confidence as the fundamental issue that is holding the housing market back is Brexit and poor sentiment as a result, particularly evident in London and the South East. Other areas around the UK have not been as affected and people that need to move are doing so successfully.
Transactions levels have dropped year on year, but only very marginally so the perception of a ‘failing market’ is not quite reality when you look at the bigger picture.
“If we leave the EU with a no-deal then some people may continue to delay moving as they wait and see what happens in the market. House prices and transactions could fall further in some areas, but not by much and the impact will only be short-lived as the current uncertainty begins to lift.”
Paresh Raja, CEO of Market Financial Solutions said, “The housing crisis stands as one of the biggest issues facing the country, and regardless of how Brexit plays out, we cannot overlook the simple fact that there are not enough houses in the UK to meet demand. The Spring Statement did make small mention of property. Indeed, more homes are being added to the market and a new £3bn fund announced today will add as many as 30,000 new homes to the market. This is positive news, but more needs to be done.
“What the market currently needs is creative reforms to ensure more homes are added to the real estate market, be it through a reduction in stamp duty, incentives for renovating derelict homes or making it easier for buyers to access finance. Weakening the Spring Statement to a fiscal non-event might suit the Chancellor but does not help the country as a whole. Moreover, overlooking important issues will not suffice, and it is once again up to industry leaders to step up and demonstrate the leadership the property market is clearly calling for by pushing for necessary changes to improve the industry.”
Director of Benham and Reeves, Marc von Grundherr said, “It may seem as though the chancellor has come out fighting for UK homeowners, but today’s spring statement was predictably compiled of regurgitated rhetoric and slightly misleading claims where the property market is concerned.
“Of the 220,000 new homes delivered last year, around 10% were, in fact, refurbs not new builds and we remain light years away from the Government’s magic target of 300,000.
“The investment into the Cambridge Oxford technology corridor has also been highlighted before but that said, it should help to stimulate this stretch of the property market should it come to fruition.
“Help to Buy is arguably the poisoned chalice that has seen prices continue to inflate due to the uplift in demand it has fuelled, while new stock delivery remains inadequate. This playing field may be relevelled should we see the £3bn affordable homes initiative bring the expected 30,000 additional homes, but as is often the case, these cash promises rarely provide a notable return.”
Jerald Solis, business development and acquisitions director at Experience Invest said, “Expectations weren’t high in the lead-up to the Spring Statement, with the Brexit melodrama dominating the political agenda and Philip Hammond consistently watering down the impact of this announcement. In truth, most of the forecasts offered by the Chancellor could change depending on what happens in the lead-up to 29 March, and this uncertainty will naturally deter some property buyers from pursing new opportunities at present.
“Unfortunately, the property market was only briefly mentioned in Chancellor’s speech, which means that any meaningful policy reform will have to wait until the 2019 Autumn Budget. This is perhaps most frustrating for property developers and constructing companies, which are the firms responsible for delivering new-builds and generally improving infrastructure.
“To support new-build construction targets, the Government cannot be complacent, what the industry currently demands is spending commitments and policy reform that will both support property developers, as well as encouraging commercial and residential real estate investment.”
Simon Gooderham, joint managing partner at Cheffins said, “Whilst no one expected this Spring Statement to bring with it a raft of changes for the UK property industry, announced measures for increased funding for affordable homes is welcomed. In an area where affordability issues are reaching crisis point, the release of land for thousands of new homes in Cambridge hopefully ought to help allow the local younger generation to clamber onto the housing ladder.
“Similarly, moves to help developer’s future-proof new build homes to meet low carbon heating and high standards of energy efficiency are essential to help purchasers to keep their money in the bank and not with the energy suppliers, whilst also protecting the environment.
“There have been too many reports of below standard housebuilding over the past few months and anything to help improve the quality and build of the UK’s new homes to ensure they are still fit for future generations are essential for the sustainable growth of the industry. In addition, any measures introduced in order to speed up housing delivery will be met with open arms as shortages of stock have reached unprecedented levels in parts of the UK.”