Could Trump Trigger a Housebuilding Boom in the North?
The UK was still reeling from the Brexit Vote when November 8th brought with it a further political storm with the election of Donald Trump. Whilst the USA is in turmoil, the UK property market could be set to benefit as economic and political uncertainty drives investor demand for UK assets.
This follows on from the recent announcement that the Government is seeking £5bn foreign investment for 13 major projects across the North, including 2 major projects in the Yorkshire Region. These new developments are set to build on the success of the “Northern Powerhouse” region and put the North at the forefront of development and investment in the UK.
How Can the Government Support Housing Growth?
The Civitas Report which is set to be published next month has recommended that Local Councils should be given powers to set the rate at which developers build out residential schemes. This would prevent developers from holding on to land banks in order to achieve a greater return and a future date. The question is how would the Local Councils enforce this? The possible solutions may include the power to :-
- Fine developers that do not comply
- Impose forfeiture of land
- Impose Compulsory Purchase Orders leading to a sale off to Housing Associations or for Local Councils to directly commission SMEs
There is also a move towards the Build-to-Rent sector from an apparent change in emphasis from the Government’s preoccupation with homeownership to one that looks at the various tenure types. If this move is welcomed we may well see a boom in the BTR sector within the UK.
So What Next?
With the potential for growth and investment in the UK Housing Sector what will the Autumn Statement bring? There have been 34 tax changes affecting Residential Property between 2010 and 2016 and there are calls for further changes to be made to SDLT in order to encourage movement in the current market. There is no doubt that the 3% Higher Rate of SDLT has not been welcomed by many investors and if the Government move to favour the BTR market then there is an opportunity for scrapping the 3% rate for such BTR schemes.
What is certain is that our team here at Lupton Fawcett will be monitoring this closely and will be ready to put you ahead of the game following the Autumn Statement.
Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.