23rd November 2016 might be the last Autumn Statement released by the Government. In a bid to reduce micromanagement and “gimmicky” policies, chancellor Philip Hammond could well do away with the annual statement altogether – but not before this year’s raft of announcements cause a stir.
With rumours of a reduction in the recently implemented stamp duty hikes for multiple home-owners (including buy-to-let landlords) and the anticipated announcement of the Home Building Fund, this autumn’s statement could mean big changes in the UK’s property market.
Here’s what could unfold…
Stamp duty reprieve
Implemented in April 2016, recent increases in stamp duty for home-owners purchasing any additional property, either as a second home or a buy-to-let investment, have been understandably unpopular amongst landlords triggering a stampede to buy property before April this year. Additional upcoming changes to buy-to-let tax relief have also had an unsettling effect on the property market, and pushing many landlords to set up limited companies to minimise the inflated cost of owning property.
Although some have found loopholes, communities secretary Sajid Javid has hinted that the chancellor may announce some softening of the rules or reduction in stamp duty. Neither confirming nor denying the possibility, Javid stated: “if the chancellor does want to make a change he will have an opportunity to do it”.
A reduction in the surcharge or reprieve relating to tax relief could trigger more competition for property from buy-to-let landlords, increasing prices in competitive areas.
Home Building Fund
Hammond is also highly likely to announce the launch of the Home Building Fund over the course of the Autumn Statement. Designed to help tackle the UK’s worsening housing crisis, the anticipated £5bn fund will go to small and medium-sized developers, with the aim of getting a minimum of 160,000 new homes under construction as soon as possible.
Although most of the fund is expected to go to small firms, some is also predicted to go to the much-maligned build-to-rent sector. In the current climate, small developers currently struggle to access finance – especially when time is of the essence. This new measure has been designed to help these developers get approval, get funding and get building faster, helping to tackle to dearth of new homes currently being created in the country.
How will these possible Autumn Statement changes affect you? Do you have any predictions about what Hammond may have in store? Have your say on our social media channels, and for “up to the minute” advice, guidance and support with any type of mortgage, contact our expert advisers today.