The 2016 iteration of the Autumn Statement took on greater significance than in previous years. In the aftermath of what has been a year of important economic events, the announcement gave the Government a chance to provide clarity, direction and inspiration for the UK property market. In his first Autumn Statement – and also his last, it transpired – Philip Hammond made several notable announcements relevant to the property sector, but there were also some surprising omissions.
In the lead-up to the Autumn Statement announcement, our CEO Paresh Raja was featured in the press offering his thoughts on what Chancellor Hammond should deliver as part of his first major economic announcement. Noting that Britain, and its UK Brand, is globally renowned for a robust property market spanning both commercial and residential developments, Paresh called for the Chancellor to offer greater clarity for both retail and commercial property investors.
Speaking to Bdaily, Paresh said: “At a time of significant political and economic transition, our post-Brexit government bears a critical responsibility to encourage an agile infrastructure for the property market, sustaining growth well-beyond the monumental events we have seen in the last year.”
The 2016 Autumn Statement ended up delivering a series of promising intentions regarding letting, affordable homes and infrastructure improvements. Beyond the banning of letting agent fees, one of the Government’s key announcements was that it is launching a £2.3 billion fund to deliver infrastructure for up to 100,000 new homes in areas of high demand. It was also revealed that there would be £1.4 billion worth of investment to build 40,000 new affordable homes. London will be receiving an additional £3.15 billion in national affordable housing funds to build over 90,000 homes.
Despite this, constructive changes to benefit the prosperity of property buying in the UK were overlooked. In particular, reforms to Stamp Duty had the potential to incentivise further investment into the UK’s already vibrant and in-demand property market. The omission of this key policy – designed to increase tax income from property purchases – is made more surprising by the fact that it could actually hinder the amount of money the Government receives through real estate deals.
Having reviewed the key policy announcements, MFS has released a new report that examines exactly what the statement means for the UK property market, and considers whether the Chancellor did enough to ensure the prosperity of this vital industry.
Click here to download ‘2016 Autumn Statement: What does it mean for the UK property market?’