Spring Statement

Industry reacts to Spring Statement 2019




Philip Hammond’s Spring Statement has received a mixed reaction from stakeholders within the property and business finance communities.

The chancellor began with an update on the state and health of the UK economy, but with Brexit looming large, the summary was not particularly heavy on substance pertaining to property policy.

John Ellmore, director at KnowYourMoney.co.uk, claimed: "Under the shadow of Brexit and last night’s second defeat for the PM, Hammond’s task of delivering [the] Spring Statement was unenviable.

“And, in truth, the speech was predictably light on substance, which is a shame for people who are trying to manage their financial plans.

“The tax-free personal allowance was increased to £12,500 today, but this comes as no surprise given the government announced its intention to do so last year.

John added that, in the past decade, the UK had experienced a global recession, the EU referendum and a string of general elections, none of which had helped consumer confidence.

“In the 2019 Spring Statement, the chancellor could have eased people’s concerns by introducing more tax reforms and spending policies to help young families, working professionals and retirees alike,” John explained.

“Instead, we received some slightly worrying economic forecasts — albeit dressed up nicely — and a continuing focus on the Brexit saga.”

However, the chancellor did discuss the government’s determination to fix the housing market and make housing more affordable.

Hammond announced the government’s Affordable Homes Guarantee scheme, whereby the government will guarantee up to £3bn of borrowing by housing associations.

Paresh Raja, CEO at Market Financial Solutions, said: “The housing crisis stands as one of the biggest issues facing the country, and regardless of how Brexit plays out, we cannot overlook the simple fact that there are not enough houses in the UK to meet demand.

“The Spring Statement did make [a] small mention of property.

“Indeed, a new £3bn fund announced today will add as many as 30,000 new homes to the market.

“This is positive news, but more needs to be done.

“What the market currently needs is creative reforms to ensure more homes are added to the real estate market, be it through a reduction in stamp duty, incentives for renovating derelict homes or making it easier for buyers to access finance.”

Paresh added that it was up to industry leaders to step up and demonstrate the leadership the property market was calling for by pushing for necessary changes to improve the industry.

The chancellor also set out to deliver a Future Homes Standard by 2025 so that new-build homes are future-proofed with low-carbon heating and world-leading levels of energy efficiency.

Jerald Solis, business development and acquisitions director at Experience Invest, said that meaningful policy reform relating to the property market didn’t get the attention it needed.

“Expectations weren’t high in the lead-up to the Spring Statement, with the Brexit melodrama dominating the political agenda and [with] Philip Hammond consistently watering down the impact of this announcement.

“In truth, most of the forecasts offered by the chancellor could change depending on what happens in the lead-up to 29th March, and this uncertainty will naturally deter some property buyers from pursing new opportunities at present.

“To support new-build construction targets, the government cannot be complacent — what the industry currently demands is spending commitments and policy reform that will both support property developers, as well as encouraging commercial and residential real estate investment.”

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