Once again, despite many calls for change, another Budget that seemingly failed to address growing pressures on the PRS and another missed opportunity for housing reform.
With a budget heavily geared toward boosting economic growth, you would expect the housing market to have at least made a guest appearance given how central it is to the economy. Nothing.
Lack of support for first-time buyers, no mention of how to address new home supply issues, and a missed chance to encourage existing landlords to remain in the market and attract new landlords with some form of tax-break.
As you would imagine, the property industry was quick to react. Here's what they're saying:
Tom Mundy, COO, Goodlord: "Today's Budget will have raised eyebrows across the sector. Not because of a controversial policy announcement, but because property and housing were completely overlooked. As the nation faces a housing squeeze, rising rents, and a potential exodus of landlords, this critical sector barely got a mention. We hope that this isn't a true reflection of the Government's priorities. If decision-makers overlook housing, tens of millions feel the effects."
Chris Norris, Policy Director for the National Residential Landlords Association: “The Chancellor spoke of growth yet did nothing to introduce the pro-growth measures that are necessary if the private rented sector’s supply crisis is to be addressed.
“The current system, under which landlords are penalised for providing new homes to rent, only makes it tougher for many renters to access good quality rental properties. Without a comprehensive review of how the sector is taxed, supply and demand issues will only become more acute as time goes on.
“Today’s Budget also does nothing for those who are in receipt of housing benefit payments, who will continue to face an unjust freeze on the support they need.”
Nathan Emerson, CEO of Estate Agent Body, Propertymark: "The Chancellor has outlined a positive economic outlook in relation to growth, inflation and debt that will provide confidence to those looking to buy and sell their homes. Additional funding for Levelling Up regeneration projects will also help to develop communities and places where people want to live.
"However, despite the continued focus on VAT relief for energy-saving materials it is disappointing that funding for energy efficiency improvements be-it for homeowners or landlords is not on the UK Government's agenda and the Budget is a missed opportunity to support people to de-carbonise the housing sector.
"Additionally, there was no mention of tax incentives to boost much-needed supply in the private rented sector. Whilst we recognise the UK Government’s focus on getting more people into work, there is little appetite to improve the welfare system and support those who are struggling the most which will have a continued knock-on impact, particularly for those low-income households who rent.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman: "We wanted to see more from the Chancellor, particularly with regard to increasing supply of new homes to keep prices in check, as well as increased support to encourage new landlords and discourage others from leaving the sector.
"In some ways, it could be seen as a positive Budget in that the Chancellor left the housing sector well alone. Housing makes such a significant contribution to economic prosperity due to its multiplier effect so is sensitive to even small changes.
"More specifically, the housing market is all about confidence and sometimes you can do more damage by tinkering so we will give him a B-plus for effort and not doing anything which could have been harmful and compromised activity."
Nick Chadbourne, CEO at LMS: “The lack of any tangible announcements in today’s budget to help stimulate the housing market, both residential and buy-to-let, is a concern. Brokers are doing their best to ensure that they provide the best possible support and outcomes to their clients, but, following the turmoil of last year, we need to see the market addressed on a broader level.
"That necessitates helping people get onto the property ladder by increasing housing stock – this will ease the pressure on the rental sector while also improving the affordability across the board, especially for first-time buyers. It’s not necessarily an easy task, but we can start by loosening planning restrictions, and changing the punitive measures on landlords that are driving them out of the market altogether.”
Mark Harris, chief executive of mortgage broker SPF Private Clients: "It is hugely disappointing that the Chancellor didn’t introduce any measures to improve the lot of the first-time buyer. With the soaring cost of living, getting on the housing ladder has become harder than ever and measures to help those struggling to buy their own home would have been welcome.
"The housing market is a significant contributor to the overall health of the economy and it is hard not to feel that Jeremy Hunt missed a trick by not introducing any measures to stimulate activity.
"On the plus side, the inflation outlook is encouraging, which should help bring interest rates back down and continue to make mortgage pricing more palatable to borrowers."
Avinav Nigam, co-founder and COO at IMMO: “Any commitment to helping those in the rental sector remains curiously absent from the government’s announcements, as does support for improvements to housing stock to meet climate targets.
"Trends point to the proportion of those renting continuing to grow as interest rates continue to rise, while housing delivery stagnates, and the existing stock remains unaffordable. A focus on homeownership must be matched by a focus on high-quality, affordable rental homes - only possible through encouraging the kind of institutional investment in the sector that can refurbish the UK’s notoriously leaky, ageing housing stock."
Jonathan Samuels, CEO of Octane Capital: “The government has made numerous legislative changes to ‘improve’ the rental market at the expense of the nation’s landlords, changes that have ironically led to higher rents, less accommodation and lower standards.
"We were hoping that they had finally realised the error of their ways and wanted to once again tempt buy-to-let investors back into the fold.
"Unfortunately this hasn’t been the case and, with them also pushing forward with changes to Capital Gains Tax allowances, we expect to see more landlords exit the sector as a result.”
Marc von Grundherr, Director of Benham and Reeves: “Another missed opportunity for the government to finally do away with the archaic and unnecessary buyer tax that is stamp duty. Doing so would have offered a hand up to thousands of beleaguered buyers who are hard-pressed to overcome the high cost of homeownership and helped ensure the market puts its recent cold spell well and truly behind it.”
Chris Hodgkinson, Managing Director of House Buyer Bureau: “The property market has been treading water since last September’s shambolic mini-budget and we were looking to the spring statement for a shot in the arm that would reignite the furnaces of buyer demand and help negate any prolonged period of subdued activity.
"Unfortunately this hasn’t materialised and the nation’s homebuyers have been shown the cold shoulder once again. While we expect the market to hold fairly firm over the coming year, it’s extremely unlikely that house prices will now rally and the pandemic highs of previous years will be resigned to the record books.”
Tom Bill, head of UK residential research at Knight Frank: “The Budget has certainly provided more of a boost for the UK housing market than the mini-Budget did. The absence of a recession will lift sentiment as buyers and sellers adapt to the new reality of higher mortgage rates. However, we expect house prices to fall by 5% this year as buyers recalculate their budgets and more supply comes onto the market.”
Nick Leeming, Chairman of Jackson-Stops: “While high energy costs were front and centre in the Chancellor’s statement, today’s announcements missed an opportunity to tackle the climate conundrum in the long term for the UK’s housing stock. Homeowners want to play their part and make their homes more energy efficient but the cost of doing so and lack of clarity on what needs to be done is holding them back.
“Funding and support to help homeowners retrofit and install low carbon heating currently does not go far enough, feeling convoluted and vastly inaccessible for many. The government’s target of reducing domestic energy usage by 15% by 2030 is ambitious and won’t be possible without a joined-up effort from Government and the property industry alike.
"Introducing zero-rate VAT for building repairs on period property to encourage essential maintenance would be well received, going beyond just energy-efficient materials as we know such upgrades cannot be done in isolation. Longer-term measures to ensure that our historic homes are protected means making them fit for the future now.
“Now is also the time for the Government to consider how to make our existing housing market more liquid to support economic growth, as new housing delivery is in decline. Measures such as offering a tax break incentive for downsizers - or indeed right-sizers - to find a home that suits their changing lifestyle, would free up much-needed housing stock at the middle and upper end of the market, and one that could be well received amongst older homeowners who are suffering most with high energy costs.
"New reports suggest that the over-65s are bearing the brunt of the energy crisis, in some cases having to pay £611 more per year on bills than those under 30, due to the increased likelihood of them owning a house for a much longer stretch of time and therefore without the impetus, or in some cases, funding, to renovate to become more efficient.”
Andy Sommerville, Director at Search Acumen: “In the current climate, the Government’s ambition to transform the UK into a tech super-power is absolutely the right one. All sectors will benefit from this, including property. Technology drives business efficiency and innovation, which is where growth opportunity lies in a slow economy.
"Tech hubs are an important part of that mix, linking up industry and academia to ensure that the UK can capitalise on its reputation for technology, thought leadership and entrepreneurism. As we know, much of this innovation comes from start-ups and SMEs, so it was an opportunity missed to not freeze corporation tax for these smaller businesses to support growth.
“For the property sector, it’s a budget that gives with one hand and takes with the other. Investment Zones provide the potential for deregulation and simplification of the planning system, which will be attractive to developers and a potential stimulus for local economies, while tax incentives will support the occupier market in these locations.
"The fact that economic estimates are proving more favourable than perhaps predicted six months ago, will also be encouraging for property investors who might now anticipate a swifter recovery of asset valuations than forecast. However, increasing corporation tax for large businesses, along with the possibility that many occupiers will see big rises in their business rates bills from April, will have a negative impact, particularly on sub-sectors of the property sector and geographical regions most impacted.
“Today, we heard that because of elevated tax revenues, the Chancellor will have more financial headroom than anticipated. We would strongly urge the Government not to sit on these returns, but to reinvest to drive growth. Economic improvement through 2023 and 2024 will be hampered if we don’t invest in key services and processes that support our economy.
"For example, decisions around planning and processing of property transactions continue to move very slowly, which is a severe drag on economic activity and output. Investing in improving these systems and supporting local planning authorities, will undoubtedly provide a quicker and more robust economic recovery.”
David Alcock, MD at Blend: "Today’s Spring Budget was expected to focus on the government’s plans to boost economic growth, but frankly economic growth is entwined with the housing market and there cannot be sustainable economic growth if first the housing market is not fixed. Many parts of the country, including London and the Southeast, are just unaffordable for most people. In the past, the government’s answer to the housing crisis has been throwing demand at the problem - we have seen successive governments trying to [unsuccessfully] tackle the housing issue by coming up with measures to support demand, but that sadly left the supply of housing struggling to keep up.
"So, in today’s budget, I was looking forward to a larger focus on supply-side measures and support for SME property developers in today’s budget. Unfortunately, that wasn’t to be, and today’s budget yet again missed the opportunity to tackle the UK’s deep-running housing crisis."
Michael Cook, Group Managing Director of Leaders Romans Group: "For a Budget intended to reverse the economic slowdown and the cost of living – in the Chancellor’s words, ‘a budget for growth, long-term sustainable growth’, this only scratched the surface, providing little help for those unable to afford to rent or buy.
"The property industry had hoped for so much more.
"To prevent rent escalation and homelessness, we had hoped that the supply/demand imbalance in the private rented sector would be addressed. We need an efficient and fair way of attracting good quality landlords back into the sector, to support tenants struggling to find suitable affordable accommodation.
"Since the government ended the Help to Buy scheme it has become even more difficult for first-time buyers to get on the housing ladder. Thousands throughout the country could progress onto the property ladder if a suitable alternative was put in place, but needs to be done quickly. Experts within LRG’s Shared Ownership division propose a deposit match scheme, enabling those would-be homeowners who don’t have accessible funds in the ‘bank of mum and dad’ to put down the necessary deposit.
"We had also hoped to see a reduction in stamp duty to encourage downsizing, and in doing so free up more family homes for those who desperately need them."