Member Article

Autumn Statement: “Policy needs to reflect reality”

Autumn Statement “Policy needs to reflect reality of housing in Britain in 2015”

• Tax rise for rental homes is “potentially damaging for North East”

A leading property expert has responded to George Osborne’s Autumn Statement and Comprehensive Spending Review , stating: “Government policy needs to better reflect the reality of housing in Britain in 2015 – and George Osborne succeeded in some areas better than others”

Announcements relating to housing in the Chancellor’s speech setting out the state of the UK economy and his spending plans for the next four years include: • A government target for 400,000 new affordable homes to be built in England by 2020. • 200,000 new “starter homes” priced £250,000 or less outside of London and sold to first time buyers under the age of 40 at a 20% discount. • 135,000 new shared ownership properties - allowing families earning less than £80,000 to move in to new homes and assume ownership over time. • Housing benefit for new social tenants to be capped at same level as private sector • A new pilot scheme allowing five housing associations to allow tenants to buy their own homes, which begins at midnight. • A 3% surcharge on stamp duty for buy-to-let properties and second homes from April 2016.

Ajay Jagota of North East based sales and lettings firm KIS Group responded to the speech:

He said: “The biggest thing I took away from today’s speech is that the government finally sees housing as a priority – and not before time.

“Now housing is a priority government policy needs to reflect the reality of housing in Britain in 2015 - and in that sense George Osborne succeeded in some areas better than others.

“There’s been talk of the Chancellor privatising social housing, but if anything he’s behind the trend -it’s been almost 4 years since the private rented sector overtook the social rented sector as the second largest tenure in England.

“That’s why the 3% rise in Stamp Duty for Buy to Let properties was such a surprise.

“In recent weeks both the Chancellor and the Governor of the Bank of England have implied that the Buy to Let market needs cooling. In London that might be true maybe, but it certainly isn’t the case in the North East.

“In recent months we’ve actually seen a shift in property investment towards our region away from the other parts of the country which is great news in terms of improving the stock of rented housing for those who can’t or don’t want to buy. My fear is the government is now risking applying the brakes at the wrong time to the wrong place.

“Using national policy to solve a London problem is a potentially damaging for North East housing.

“When it comes to housebuilding, we have had an arms race of announcements when it comes to the number of houses political parties of all persuasions have promised to build which hasn’t necessarily been reflected in the number of houses actually being built.

“Despite a growing population we still have the lowest levels of house-building since the end of the First World War with home ownership falling year-on-year to the lowest level in a generation. Any initiatives tacking these issues are to be welcomed.

“What is vitally important is that the incentives being offered to house builders reach the smaller operators with the flexibility to take on the smaller scale developments which are key to meeting Britain’s housing needs.”

KIS Group is famous for being the first letting agents in the UK to abolish deposits, replacing them with a one-of-a-kind landlord insurance policy offering guaranteed rent, deposit replacement, legal assistance and round the clock third party emergency home repairs.

Ajay is also the founder of Dlighted, an insurance backed deposit-free renting solution which drastically reduces the costs for tenants finding and moving homes whilst still protecting both agents and landlords against damage.

This was posted in Bdaily's Members' News section by Ajay Jagota .