The Chancellor’s first budget resulted in a slowed down economy, tax increases, job losses and extra borrowing with, it seems, more doom and gloom to come as its effects on employers take effect.
Six months later, based on the Office for Budget Responsibility’s optimistic view of public finances, the 26th March Spring Statement promised measures to kickstart the property market to fulfil the government’s promise of building 1.5 million new homes over the next five years.
More social and affordable housing
An additional £2 billion was announced to build up to 18,000 new homes in England to increase the number of social and affordable houses that would go some way to “fixing the housing crisis”. The government said this was a “down payment from the Treasury”, ahead of further announcements to boost long-term investment in social and affordable housing.
In 2024, the New Economics Foundation estimated that 90,000 more social homes would be required by 2027/28 to meet the government’s target, and that 110,000 new social homes would be needed to “ensure 1.5 million homes are built”, amounting to 365,000 social rent homes over the next five years.
The number of households on local authority waiting lists in England is at the highest figure in a decade and stood at 1,330,611 in 2024. Previously, the highest figure was 1,370,410 in 2014.
Chief executive of housing and homelessness charity Crisis, Matt Downie, welcomed Tuesday’s announcement and hoped it would be “the beginning of a social housebuilding programme that will radically shift this country’s response to homelessness, putting housing at the heart of the solution”.
Other changes
Over the next four years, £600 million will be made available to train 60,000 new bricklayers, carpenters and electricians.
The Planning and Infrastructure Bill will reduce planning red tape, allowing planning committees to fast-track new building.
The Financial Conduct Authority has confirmed it will consult on helping those seeking a mortgage by easing the mortgage stress test and making it easier to switch mortgage providers. Some providers have already increased existing loan to income values on residential mortgages.
Stamp duty thresholds have now reverted to the levels set in September 2022: £125,000 for home movers, and £300,000 for first-time buyers. Around 75,000 home buyers are likely to have failed to complete in time for the revised deadline, despite some transactions starting in January.
The Energy Department is consulting on ways to improve the Energy Performance Certificate (EPC) rating of private rented homes, which are required to reach a ‘C’ rate by 2030. The average cost to landlords to improve to this level is estimated to be over £6,000 per property.
Welfare cuts, spending cuts within government departments, job losses and higher living costs are all due to kick in this year.