Home Property Mixed reaction to the Chancellor’s lacklustre Spring Budget

Mixed reaction to the Chancellor’s lacklustre Spring Budget

6th Mar 24 2:30 pm

The Chancellor has just delivered his Spring Budget, announcing an extension to the freeze on fuel duty, funding for 8,000 houses across Barking Riverside and Canary Wharf, the launch of a new British ISA, a reduction in capital gains tax and further cuts to National Insurance.

Launch of British ISA welcomed

Jason Ferrando, CEO of easyMoney said, “It’s great to see ISAs featured in today’s Budget and the Government’s commitment to making them more accessible to investors demonstrates just how popular they have become as an investment vehicle.

The launch of the British ISA, providing an additional £5,000 in addition to existing allowances, will only strengthen the appeal of ISA investment and help to bring greater awareness to the already wide range of products available and their varying benefits for investors of all shapes and sizes.”

Capital gains tax the small rabbit out of the hat

Sam Reynolds, CEO of Zero Deposit said, “It’s disappointing to see the Government implementing further measures to reduce the financial profitability of many landlords with both a clamp down on short-lets and multiple dwellings relief.

There’s no denying that the increasing prevalence of short-term lets can have a detrimental impact on local housing markets, but the irony is that this problem has been made substantially worse due to the Government war waged against private landlords in recent years.

Many landlords have made the decision to move the short-term lettings space as a direct result of previous legislations designed to reduce buy-to-let profitability and, as always, the Government is now playing catch up in addressing a problem of its own making.

However, the rabbit out of the hat, albeit a small one, was a capital gains tax reduction. While it could be argued that this might tempt even more landlords to now exit the sector, it should, at the same time, make buy-to-let investment more attractive and encourage more landlords to invest.”

Property market shown the Budget cold shoulder

CEO of Lomond, Ed Phillips, said, “Disappointing to see the UK property market receive the Budget cold shoulder yet again following what was a lacklustre Autumn Statement.

However, the property market has weathered a tough few months and has held firm despite many predictions of an impending collapse. We’ve also seen early signs that buyers are returning despite interest rates remaining at their highest since 2008 and this has also caused house prices to start to creep up.

This resilient performance is no doubt why the Government has chosen to refrain from any property focussed initiative in the Spring Budget and it’s very much a case of no news is good news in this respect.”

Sigh of relief over no 99% mortgages

CEO of Yopa, Verona Frankish, said, “Time and time again, we’ve seen the Government opt to keep the housing market afloat by exacerbating the demand supply imbalance and there was a very real danger that they would make the same mistake today with the launch of the 99% mortgage.

Thankfully, this ill-advised initiative hasn’t come to fruition as it would have dangerously overheated the property market, pushing house prices beyond the record highs seen in recent months and further out of reach for the average buyer.”

CEO of Open Property Group, Jason Harris-Cohen, said, “While stoking the furnaces of buyer demand may help ignite the property market from a house price perspective, doing so is not without its drawbacks.

In fact, we’ve seen how overloading the property market can be detrimental in the long-run and in the wake of the stamp duty holiday many buyers and sellers were subject to lengthy delays, with the number of transactions subject to fall throughs also spiking notably. There’s no doubt similar issues would have arisen had the 99% mortgage become a reality.

Yes, market conditions have slowed in recent months but we’ve already seen signs that this is on the turn and the Government has made the right decision today to adopt the slow but steady approach to re-cultivating market health.”

Co-founder and CEO of GetAgent.co.uk, Colby Short, said, “The Government has dodged a bullet by pulling their ambitions for a 99% mortgage at the eleventh hour and the property market will be better off from it in the long-run.

Artificially inflating the market via gung ho, demand led initiatives, without addressing the issue of supply, is a dangerous game to play and one that can ultimately cause the market to collapse.”

8,000 new homes demonstrates head in the sand approach to housing supply

CEO of APRAO, Daniel Norman, said, “Despite the severity of the housing crisis, we’ve seen the Government pass the buck from one Budget to the next, maintaining their head in the sand approach to addressing the issue of housing supply.

To detract from their failure in building enough homes they’ve offered up the odd bone such as today’s announcement to deliver a mere 8,000 new homes in Canary Wharf and Barking Riverside.

However, this sole announcement for new homes equates to just 0.02% of the Government’s total budget.

It’s simply not enough to entice buyers into the market if they don’t intend to incentivise developers to break ground and deliver the volume of homes required to satisfy demand.

Unfortunately, it’s not a problem that can be remedied overnight, or without proper long-term planning and implementation. So we can expect the Government to continue to turn a blind eye, while papering over the ever growing cracks with regurgitated rhetoric such as stamp duty reprieves.”

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