Have a look at the UK property industry’s wishlist for Chancellor George Osborne’s budget announcements.
1. Reversal of recent Government stamp duty changes
The recent reforms made to UK stamp duty are having a damaging impact on the overall housing market and should be reviewed.
The changes to Stamp Duty Land Tax announced in the 2014 and 2015 Autumn Statements have already noticeably chipped the confidence of both domestic and foreign buyers.
Due to those developments, buyers might now be wondering: what next?
In addition, even The Treasury itself has lost more than £0.5bn in revenue during the period.
2. More pragmatic support for SME developers
Over the past 2 years, there has been a series of policy announcements to help smaller developers. However, the question is how effective those changes will be in practise?
As an example, measure aimed at giving SME housebuilders the opportunity to take on projects they were previously unable to by offering sites with planning permission from public land are a clear move in the right direction. But so far only 13,000 homes have been directly commissioned by the Government across only 5 sites, a fairly insignificant amount considering targets of building one million more homes by 2020.
To successfully address the housing crisis in the UK, the Government needs to be more direct in its approach to supporting small and medium sized developers – by funding the solutions to the viability gaps on these sites, investing in the appropriate infrastructure and boosting the home and communities agency’s treasuries so they are able to provide funding alongside private financiers.
3. New approach to finding brownfield sites
In early 2015, the Coalition Government announced plans to acquire planning permission on 90% of brownfield land. One year later 28 housing zones have been identified which could create 45,000 homes.
Many of these site will be brought to life in public private partnerships and request specialist financial structures which are only possible through a thorough understanding of development and security, to help financiers to get comfortable with the revenue and risk of the projects. Nevertheless, some of the most innovative financiers in the current market (like alternative non-bank lenders) haven’t been invited to the table.
Working with a bigger number and a variety of financiers could be the key to opening up development of brownfield sites and the government acknowledge this.
Source: City A.M.
