In last week’s autumn statement from the chancellor there were quite a few things in it that will affect the housing and rental market, both positively and negatively. Let’s take a quick look at what they are:
- A commitment of £7 billion investment has been made in a house building programme across the UK to help address some of the huge supply and demand issues that exist. This is the largest investment in a housing programme since the 1970s and, whilst it won’t solve the issue completely, it’s a step in the right direction.
- There will be a 3% surcharge on stamp duty for buy-to-let properties which will cause investors to pay more when they invest in the private rented sector. The addition of a 3% extra charge for buy-to-let and second homes on all stamp duty bands above a £40,000 starting level will start from 1st April 2016 so this may create a major rush for buy-to-let and second home purchases before April.
- Around £2.3 billion will be paid directly to developers to build 200,000 starter homes specifically aimed at first time buyers. Buyers will be offered a discounted rate of 20% on homes worth £250K plus regionally and £450K plus in London.
- £400 million has been earmarked for the specialties sector which includes housing developments aimed at the elderly and for people with disabilities.
- £200 million has been announced for 10,000 new homes that tenants can live in for five years at a reduced rental rate. At the end of the tenancy, the house can be bought outright.
It will be interesting to see the impact that these changes make to the home ownership versus rental market over the next 12 to 18 months. For more information about the autumn statement please click here https://www.gov.uk/government/topical-events/autumn-statement-and-spending-review-2015