Amid all the chaos and drama of the ongoing Brexit saga, there was another significant event taking place in Westminster on March 13th: the chancellor of the exchequer’s 2019 Spring Statement.
The announcement was very much overshadowed by Brexit, and while Philip Hammond did announce a £3 billion affordable homes scheme, there was little mention of the property market as a whole.
Restoring ‘the dream of homeownership’
The chancellor’s objective with the new affordable homes initiative is to deliver some 30,000 additional properties across the UK, through up to £3 billion of guaranteed borrowing by housing associations.
During the statement, he claimed the government’s “ambitious plan to restore the dream of homeownership to millions of younger people is already delivering”.
He mentioned planning reform to release land in areas where the need for housing is greatest, as well as a five-year, £44 billion programme to boost annual supply of properties to 300,000 by the mid-2020s.
Regarding the state of the UK economy as a whole – which could be a consideration for overseas investors in British property – Mr Hammond said the economy had “defied expectations”.
Current forecasts suggest economic growth will improve steadily over the coming years, from 1.2 per cent this year, to 1.4 per cent in 2020 and 1.6 per cent in 2021.
The risks of complacency
Perspectives on the Spring Statement from the property industry suggest most businesses feel the chancellor didn’t provide anything new or substantial for the housing market.
Jerald Solis, business development and acquisitions director at Experience Invest, acknowledged that expectations weren’t high before the announcement. However, he also said it was disappointing that the property market was only briefly mentioned, meaning any “meaningful policy reform” will have to wait until the Autumn Budget.
“This is perhaps most frustrating for property developers and construction companies, which are the firms responsible for delivering new-builds and generally improving infrastructure,” added Mr Solis.
“To support new-build construction targets, the government cannot be complacent – what the industry currently demands is spending commitments and policy reform that will support property developers, as well as encouraging commercial and residential real estate investment.”