Industry reflects on damp squib Budget

Ryan Bembridge

March 8, 2017

The industry is reflecting on a “damp squib” of a Budget which increased taxes for the self-employed and made little mention of housing or Brexit.

Andrew Montlake, director of Coreco, reacted on Twitter: “To be fair the budget was a bit of a damp squib… Housing? Stamp Duty? White Rabbit? NADA.”

Buying agent and market commentator Henry Pryor agreed, writing on Twitter: “With nothing on housing in #Budget2017 I get a lie-in tomorrow morning and you are spared my witless analysis.”

The Chancellor pledged to fund 110 new free schools and invest £216m in existing schools.

He said the Tories would introduce ‘tough financial penalties’ for professionals enabling tax avoidance which is later defeated by HMRC.

And he pledged an extra £2bn to fund social care in the next three years, with £1bn in 2017-18.

Paresh Raja, chief executive of London-based bridging lender Market Financial Solutions, said: “There had been rumours prior to the Budget that council tax and stamp duty could be replaced with an annual property-based tax.

“However, it was very surprising to see that the country’s globally-renowned property market was completely overlooked; despite commitments to building more homes previously outlined in the Housing White Paper, no further reforms or initiatives were unveiled today.”

John Goodall, chief executive and co-founder of Landbay, felt the Chancellor has missed an opportunity to raise the minimum stamp duty threshold of £125,000.

He said: “For all the talk of easing the pressure on affordability in last month’s housing white paper, Hammond’s Budget was underwhelming to say the least.

“By not raising the stamp duty threshold, the Chancellor has missed a valuable opportunity to improve access to the housing ladder for millions of aspiring homeowners in the UK, for many of whom the tax is the final straw when facing prices that continue to climb.

“Stamp duty is a significant barrier to liquidity in the market and any increase to the threshold would help to reverse the falling homeownership numbers and transaction volumes. I hope the situation is reviewed in the Autumn Budget.”

Danielle Cullen, managing director at StudentTenant, was disappointed the Budget failed to ease the pressure on landlords ahead of the buy-to-let tax changes which start coming into force next month.

She said: “Hammond has delivered yet another limited speech where the property market is concerned. In fact – no word at all on anything relating to the housing market, and no elaboration on the comments he made in the Autumn statement.

“Where does that leave private landlords and buy-to-let investors, continuously battered by increasing taxes?

“Pledges were made last November to plough money into the construction of new housing for help to buy and shared ownership schemes, but any hope of reversal of stamp duty charges on second homes have been scuppered with no further mention of anything property related at all.”

He added: “The government seem to be continuing to favour developers and big businesses building more properties and making more money, whilst penalising regular people who are purchasing buy-to-let properties as an investment or retirement income.

“Hammond’s pledges since he became Chancellor have continuously promised investment into construction, benefits and cuts to tax to build more and more properties to plug the shortage of accommodation.

“Landlords however, are feeling the pressure from taxation of turnover rather than profit, incomes putting them into higher tax brackets, and stamp duty costs; it really does put into question whether buy-to-let property investments are really worth it anymore.”

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