[ad_1]
Jeremy Hunt says he has budgeted for growth in the UK, but real estate industry officials say the chancellor has treated him ‘coldly’.
Forecasters said the government had to spend about £30bn due to lower energy costs than expected earlier last year.
The financial report was also released amid an upbeat forecast by the UK Financial Responsibility Authority that the UK will avoid a recession this year as the economy shrinks by 0.2% in 2023, as opposed to a projected annual fall of 1.4% in 2023. . November report.
Economic Watch adds that it expects inflation to fall to 2.9% by the end of the year from 10.1% at present.
However, the chancellor has decided to spend the cash he has on areas such as raising the energy price ceiling, providing larger pension baskets for the higher paid, and expanding free childcare.
Labor leader Keir Starmer said in his budget response that “there was no real ambition for housing”.
Real estate professionals expected the budget to be tight but hoped to see some action on issues such as looser planning rules, green homes, stamp duty reform or homeowner tax breaks.
But there were few in those areas, and the sector met the announcement with a mixture of disappointment and resignation.
Chris Hodgkinson, managing director of the Homebuyers Bureau, says: “The real estate market is treading water after last September’s awkward mini-budget, and we’ve been looking forward to the spring announcement to get started.
“Unfortunately, this did not happen, and homebuyers in the country again faced a cold reception. While we expect the market to be fairly resilient next year, it is unlikely that house prices will rise now and the peaks of previous years caused by the pandemic will remain in the record book.”
New home builds in the UK have fallen 2.6% from pre-pandemic levels, according to the latest data compiled by tax specialists RIFT Tax Refunds.
The firm adds that buyers have purchased only 43% of the available housing on the market this year, compared to 60% in 2022 and 63% in 2021. Between 2021 and 2022, the number of approved mortgages decreased by 20%.
With that in mind, Leeds Building Society chief executive Richard Fearon says the budget was “a missed opportunity to grow the economy by addressing the UK’s home ownership crisis caused by the housing shortage and demonstrating support for savers.
“While it is especially encouraging to see the support of families with young children struggling with childcare costs, we know that owning your own home also brings huge economic, educational and health benefits.
“With homeownership now at its lowest level in 150 years, it’s clear that supporting new home buyers should be a key battleground in the next general election.”
Rose Capital Partners founder Richard Campo says he is “frustrated” with the budget as “the consequences of inaction are now really biting.”
Campo adds: “First, we need to build more houses. At the current pace, it will take us 50 years to catch up with demand, even if we start building 300,000 homes a year, which we’re not currently doing, according to the Center for Cities think tank.
“The time has come for the government to intervene and focus on new construction methods, creating more jobs, lowering home prices in the long term, increasing the number of new home buyers and making rental housing more affordable. There are strong economic arguments for this.
“Secondly, we need to abolish the tax regime on real estate that can be bought for rent, which was introduced in April 2016. Rents are skyrocketing as landlords exit the market and things will only get worse before they get better. This is just a small source of revenue for HMRC in relative terms.”
SPF Private Clients CEO Mark Harris said: “It is very disappointing that the Chancellor has taken no action to improve the FTB situation.
“With the cost of living rising, climbing the housing ladder has become harder than ever, and measures to help those trying to buy their own homes are welcome.
“The housing market is a significant contributor to the overall health of the economy, and it’s hard not to feel like Jeremy Hunt missed the mark by not taking action to stimulate activity.
“On the positive side, the outlook for inflation is encouraging, which should help lower interest rates and make mortgage prices more attractive to borrowers.”
However, some observers question whether the chancellor’s ignorance could benefit the sector.
Jeremy Leaf, former chairman of the Royal Institution of Certified Surveyors, said: “We wanted to hear more from the Chancellor, especially with regards to increasing the supply of new homes to drive down prices, as well as increasing support to encourage new homeowners and discourage others. from leaving the sector.
“In a way, this can be seen as a positive budget, as the chancellor has left the housing sector alone. Housing makes such a significant contribution to economic prosperity due to its multiplier effect, which is why it is sensitive to even small changes.
“The housing market in particular is all about confidence and sometimes you can do more damage if you mess around so we give him a B plus for trying and not doing anything that could be harmful and compromised.” .
[ad_2]
