Housing and mortgage experts have been sharing their hopes for measures that they would like the Chancellor to announce in Wednesday’s Autumn Budget.
Rishi Sunak is expected to pledge almost £2bn of investment into building new homes on derelict or unused land in England.
Retirement villages provider Audley Group’s chief executive Nick Sanderson says it is crucial that the right type of homes are built to meet the needs of the population.
He says: “160,000 greener homes on brownfield sites is the government’s latest housing commitment but what is lacking is detail on the types of houses.
“Building more of the same will not address the issues the housing sector faces.
“We have enough houses, that isn’t the problem.
“The problem is that too many properties are under-occupied.
“There are millions of surplus bedrooms across the UK, with many owned by people who would like to downsize but don’t now have the options available.
“The government’s focus needs to be shifted to specialist housing, and fast. The benefits could be numerous.
“Freeing up homes, while simultaneously taking pressure off stretched care services. It’s time for the government to build smarter.”
North London estate agent Jeremy Leaf believes that the Chancellor should look at incentives for downsizing.
He says: “Additional tax breaks for ‘right-sizing’ and bringing empty properties back into use would be welcome to help address the shortage of affordable homes for the growing number of over-65s”
Shawbrook Bank managing director of property finance John Eastgate also believes reforming death taxes is the way to do this.
He says: “Although the government has not outwardly raised the inheritance tax (IHT) threshold in recent years, the rapid growth in house prices has left more homeowners at risk of breaching the £325,000 tax-free allowance when they pass on their estate.
“Introducing a cut to inheritance tax for those looking to downsize would help the property market twofold.
“As well as incentivising large homeowners to move into more manageable properties, freeing up bigger family homes across the market to help younger generations, it would also allow families to hold on to more of their accrued wealth and pass on to loved ones, so they too can build a deposit to buy their own home.”
Planning reform
Leaf believes that fixing the planning system should be one of the Chancellor’s top priorities.
He says: “Housebuilding has been falling due to Covid, Brexit and other reasons, resulting in material and labour shortages as well as sharply rising costs.
“We must try to improve delivery by making the planning system work more efficiently and transparently, including modernising Section 106 and Community Infrastructure Levy charges so they don’t become an obstacle. “More supply – including local authority incentives to build their own affordable housing – will help to maintain activity while keeping prices and rents in check.
“More transactions are not just good news for the property market but for the country’s job and social mobility.
“Lack of stock is deterring activity which cannot be good for first-time buyers in particular – the lifeblood of the market.”
Eastgate agrees: “After being promised the biggest shake up to the property market for a generation, expected changes to the planning process have since been scrapped leaving the door open for a revised approach from the new housing minister.
“It’s nothing new to say that the UK has a chronic lack of housing, the government must make it easier for smaller developers, and individuals, to build on viable land in order to meet current demands.
“A crucial part of this, and what we need to see from the Chancellor, is a commitment to supporting the long overdue changes to the planning process.
“The property market can have a key role to play in the government’s levelling up agenda, but only if it’s given the right tools to do so.”
Leasehold reform, building safety and build-to-rent
Leaf says: “Further details of leasehold reform and zero ground rents for existing as well as brand new properties, not just as part of levelling up, would be another way of increasing supply and activity.
“Build-to-rent and buy-to-let provide a very useful contribution at all stages of the home moving journey so require continuing support.
“More details will hopefully be announced of the adequacy of the widely-mooted £5bn property developer tax and Building Safety Levy to fund safety measures and remove potentially-dangerous cladding from blocks of flats.”
Green initiatives
Leaf says: “Good EPC ratings are still not a high enough priority for aspiring or existing homeowners but tax breaks might increase energy efficiency and retro-fitting supported by green mortgages and more generous green homes grants.
“However, it’s important to not reduce the value or saleability of older, unmodernised properties or discourage their improvement.
“The £5,000 grant for heat pumps to replace old gas boilers is a good start but needs to be backed up by further information about installation, maintenance, insulation etc.
“One size will clearly not fit all as owners and landlords will spend a higher proportion of a property’s value on this work in different parts of the country.
Eastgate believes new incentives are needed.
He says: “Many landlords or property investors will be aware of recent changes to the Energy Performance Certificate (EPC) legislation which means that all properties must reach a rating of ‘C’ or above in order to be let by 2025.
“While this is an admirable ambition, there has been a lack of guidance on how this can be achieved in practice.
“While new houses can be built with these regulations in mind, the reality is that a large amount of our current housing stock is over a century old, improving energy efficiency isn’t a quick fix.
“The recent announcement that homeowners will be given a £5,000 grant to replace their boiler with an air source heat pump is one example of how the government is taking green steps, but many have questioned whether the resource is in place to actually support the rollout.
“To fully support landlords, investors and homeowners the government must establish a new fit for purpose set of green incentives that encourage people to transition to more sustainable and energy efficient ways of heating their home or making improvements to a property, with practical guidance on how it will be achieved.”