Trevor Stunden, partner at Kettel Homes – a rent to own housing platform provider – shares the pressing issues that fall under the Treasury’s purview and could significantly impact the upcoming Autumn Budget for property investors, housing developers and first-time buyers.
As we approach the Autumn Budget on 30 October, and over 100 days of the Labour government now behind us, housing has and continues to remain a key focus with notable action already taken, including planning reforms and the passage of the Renters’ Rights Bill through its second reading. In Labour’s first Budget in 14 years, there are several areas we now expect to be highlighted affecting the residential property sector.
1. First-Time Buyer Stamp Duty Relief
The first-time buyer nil-rate stamp duty relief, currently set at £425,000 (previously £300,000) with a maximum property price of £625,000 (previously £500,000), is due to revert to previous levels on 31 March 2025. We hope that the Chancellor will extend or make this relief permanent to prevent market uncertainty and avoid the rush of transactions leading up to the deadline.
This relief benefits not just first-time buyers but also bolsters a wide range of industries including, housebuilders, contractors, solicitors, estate agents and surveyors. Rather than a direct cost to the Treasury, it is a foregone revenue that plays a critical role in keeping the housing market fluid.
2. Investment in Innovation
There is a pressing need for Homes England to have more flexibility in its budget to invest in innovative housing strategies capable of delivering scale over time. This is something Kettel Homes has been advocating for, as relying on traditional solutions will not be sufficient to address longstanding housing issues. A forward-thinking, innovation-friendly budget allocation would enable the development of new models that could transform the housing landscape in the coming years.
3. Shifting Grant Focus
We anticipate a strategic shift in grant funding, with resources being redirected from programmes like shared ownership to focus more on social and affordable housing. Organisations like the British Property Federation (BPF) are calling for a 55% increase in subsidies for affordable housing, from £9bn to £14bn, to support the creation of 145,000 new homes. This equates to a subsidy of around £96,000 per home. While shared ownership has helped many, the focus may now shift towards addressing the most critical areas of need.
4. Encouraging Private Capital Investment
With a government target of building 1.5 million new homes, and housing associations struggling to maintain existing stock due to ongoing fire and safety concerns, there will likely be an increased reliance on private sector investment in the UK residential market. This could take the form of tax incentives for investors committing capital to regions in desperate need of housing. Such incentives would provide dual benefits. First, they would encourage much needed investment, helping the government meet its housing targets. Second, this policy would not require additional government expenditure but would likely trigger positive economic effects in both the construction industry and the local communities benefiting from new housing developments.
5. Renter Reform and Judicial Support
One of the main concerns surrounding the Renters’ Rights Bill is the backlog and strain it could place on the court system, creating anxiety among landlords. The government will need to invest in strengthening the judiciary’s capacity to process cases quickly and fairly. While it may not fully resolve the issue, this investment will be a crucial first step in ensuring the bill’s successful implementation. A well-targeted allocation of funds to support the judicial system could alleviate some of the negative feedback from the private rental sector, encouraging continued investment in residential properties.
Closing thoughts
The Autumn Budget is expected to address many of these crucial topics, with the housing sector waiting to see how the Treasury plans to allocate resources and incentives. The next steps taken by the government will play a pivotal role in determining how the housing crisis is managed and whether the ambitious target of 1.5 million new homes can be achieved in a sustainable and socially responsible way.
