Autumn Statement 2016
Taylor Wilkinson Surveyors and there members
Welcome investment in housing, construction and infrastructure in Chancellor Philip Hammond’s Autumn Statement today. It includes £2.3bn housing infrastructure fund to help provide 100,000 new homes in high-demand areas and £1.4bn for 40,000 extra affordable homes. Plus £1.1bn in local transport. Potential multi-sector and local economic benefits depending on the detail
Jeremy Blackburn from Head of Uk Policy (RICS) was speaking today about the Autumn Budget 201, he said
Philip Hammond is something of a political novelty, he is a Chancellor who listens. Our “listening Chancellor” consulted widely with industry in the build up to today’s statement, as I’m sure he will as Britain moves closer towards Brexit
While he has delivered something of a wait-and-see statement, where the detail won’t be revealed until the publication of the Housing White Paper and we haven’t yet seen him pictured in a hard hat, he clearly understands the housing sector better than his predecessors.
We warned HM Treasury that the UK is facing a critical rental shortfall of 1.8 million homes. Our latest figures show that there has been a 15% decline in house sales to first time buyers over recent months. That tells us that, for all the rhetoric, David Cameron and George Osbourne’s Starter Homes Strategy failed to get off the ground. The Private Rented Sector became a scape goat under the previous Chancellor and because of that it has suffered.
Yet, with increasingly unaffordable house prices, the majority of British households will be relying on the rental sector in the future. Now it seems that through the relaxation on grants to deliver a wider range of housing types, Hammond will drive an affordable rental agenda and can get Britain building in a way that benefits a cross section of society, not just the fortunate few.
The Chancellor delivered on his theme of a fiscal recalibration rather than reset. The previous fiscal framework of a surplus, reduced debt and welfare cap were all redefined to acknowledge notable downward revisions in the economic outlook. Unlike his predecessors, Mr Hammond eschewed fiscal acrobatics and toed the line on fiscal prudence and sustainability. Additional modest spending was earmarked for raising productivity via targeted investments in infrastructure, R&D and housing. This leaves room for more contingent fiscal stimulus in the year or two ahead when it may be needed to support a weaker UK economy.
But the Chancellor should avoid the pitfalls made by his predecessors. Britain’s landlords have the potential to be the solution to our housing crisis, not the cause. It is simplistic to suggest that they must pick up letting agency charges when we are in urgent need of more landlords entering the market — a little like robbing Peter to pay Paul. Government must strike the right balance between allowing credible, regulated letting agencies to recover reasonable costs and the unquestionable need to protect tenants from suffering excessive charges by less scrupulous agents.
Opening up right-to-buy for Housing Association tenants certainly has potential and it is sensible that this is being trialled by pilot. However, we must ensure that mechanisms for replacing all sold stock are thoroughly tested in order to protect our most vulnerable.
In a recent survey, a quarter of our members told us that providing better infrastructure in Britain’s most remote areas was key to regional growth and delivering more affordable housing. The Chancellor’s £23 billion National Productivity Investment Fund and Northern Plan for road investment will undoubtedly help to plug this gap, delivering the connectivity needed to power the North and our Midland’s engine.