Budget announcement is imminent!

Wednesday 08 July 2015  / Ruth Montia

budget-case-main

Chancellor George Osborne is to make his summer budget announcement today and estate and letting agents in the property industry have been making their last-minute bid with him to support the housing shortage.

Jeremy Blackburn, the head of policy at the Royal Institution of Chartered Surveyors says “While the Prime Minister and the Chancellor have called a plan for ‘one nation home ownership’, we urgently need to increase genuinely affordable homes for rent in both public and private sectors”

It’s no secret that many can either not afford or have no desire to buy property, so to encourage the Build to Rent scheme and freeing up council and housing associations to build, is crucial right now.

Local plans need to be enforced using brownfield sites and more finance for smaller builders, are all steps in the right direction, but there is the need to be part of an overall synchronised strategy

The Residential Landlords Association also wants more homes in the rental sector. They say that with the majority of landlords being individuals renting out just a small amount of properties, the government should use the tax system to recognise this as a business movement.

The RLA is calling for an end to the problem that means that VAT can be reclaimed where a new home is built for owner occupation, but not for rent.

To support the government’s ambitions for home-ownership, the RLA is calling also for roll-over relief on Capital Gains Tax where the sale of a rented property is to a first-time buyer, with suitable controls to avert abuse, such as an upper limit on price. RLA chairman Alan Ward says “The private rented sector is now the only housing tenure growing, with demand set to increase further”.

For the time being the chief executive of eMoov online estate agency, Russell Quirk, is harshly critical of the government’s policies to date which he believes are fuelling demand while doing very little about supply.

Quirk wants the Tory government to identify all developable land owned by public sector organisations and legislate to force them to provide it for building. Central and local government currently own 180,000 land assets including thousands of hectares of land. An airport is also amongst the £380 billion of assets under public ownership.

Quirk has also suggested a tax relief for High Net Worth Individuals and companies in exchange for them investing cash into social housing schemes. Each scheme would provide a revenue and would be traded to subsequent HNWIs or companies after five years of ownership.

We will wait to hear the Chancellors announcement later today.