Construction has mixed response to Autumn Budget< Back to Blog
There were two key areas of good news.
Firstly, there was a pledge to increase the construction of new homes to 300,000 per year on average by the mid-2020s. To support this growth, the government will commit at least 44bn in capital funding, loans and guarantees for house builders over the next 5 years. The initial focus will be on speeding up developments where planning permission has already been granted but other measures include ensuring town hall bosses allocate small pockets of land to small developers.
The second and more surprising piece of good news was the announcement of a cut in stamp duty for 1st time buyers purchasing properties up to £300,000 plus a reduction in duty up to £500,000. For small developers, this could increase confidence of a quick sale once developments have been completed and provide more scope for re-investment in the sector.
OK, so now the not so good news…
While pledges to build more new homes are great, as everyone in the construction industry knows, the sector is facing a constant struggle with skills shortages, with some trades being almost impossible to recruit. The fallout from Brexit is likely to make this even trickier, so the big question is ‘who is actually going to build these new houses?’. The answer is not entirely clear!
As for the boost for first time buyers, this is still likely to be hampered by the ongoing squeeze on people’s incomes and the fact that (stamp duty or no stamp duty) most younger people just cannot save the kind of deposits required to get on the housing ladder. Coupled with the fact that forecast growth to the UK’s economy was reduced from 2% to 1.5% and you’re left wondering how many people will really benefit from this tax cut. The Office for Budget Responsibility has suggested it will simply push up house prices, benefiting people who already own a home more.
With all of this in mind, what can we at Sheriff Builders do to make the next few years more rosy than grim?
Sheriff Builders Ltd is already working with some of the leading developers and Housing Associations across London and the Home Counties, ensuring that house building projects are delivered to quality standards on schedule. We will continue to focus on these long-term relationships with the contractors we work with.
We’re lucky to be able to draw from a 40-strong reliable workforce with skills in both brickwork and roofing. We’ve helped many young people to train and develop their skills on the job and will maintain this approach.
We’ve embarked on a number of small development projects of our own which are adding much-needed housing stock to the Luton area. One example is our recent Brook Street development and, as we are reinvesting in the sector, we hope to announce news of another exciting project very soon!
Right now, Sheriff Builders is following a business plan which is fully set on a period of growth. Wish us luck!
* While Sheriff Builders has done its best to ensure the statements and representations within this article are accurate, complete and valid, this cannot be guaranteed. Sheriff Builders accepts no liability for any errors, omissions or representations.