Chancellor of the Exchequer Rishi Sunak has announced a series of property-related measures in his latest Budget which could affect homebuyers (and sellers), landlords, tenants and property investors.
Independent estate agents Maunder Taylor, who are based in Totteridge, take a keen interest in all aspects of the property market. Here we look at all of the key housing headlines from the Chancellor’s statement.
Cladding
The Government has pledged to make £5billion available towards the cost of removing and replacing unsafe cladding in high-rise buildings. This was prompted by the Grenfell Tower blaze in London in 2017 which killed 72 people. This devastating tragedy led to any flammable cladding similar to that found in the Grenfell Tower being removed from buildings across the UK. However, the cost of removing the cladding has often been levied against the residents, and not the developers who installed it.
The £5bn figure will partly come from the new Residential Property Development Tax which was first announced in February 2021. The tax will come into force in April next year and will take the form of a 4% levy on any annual profits developers make in excess of £25million.
The Capital Gains Tax Window
The Capitals Gains Tax window, which was first introduced in April last year, has now been extended. Anyone selling a UK residential property will now have 60 days from the date of completion to report and pay their CGT bill, rather than the previous deadline of 30 days.
The change applies to both UK and non-UK residents. For any mixed-use properties, the new window will only apply to the residential element of the gain.
Affordable and Green Homes
The Government has also pledged to invest £1.8bn in new affordable homes, with brownfield sites initially prioritised as development sites – and the aim is the new homes will be ‘green’. Broken down, £1.5bn will go on land clearance and regeneration projects nationally, while the remaining £300m will go directly to local councils to invest.
The Government says this will result in over 160,000 new homes being built and forms part of their overall commitment to build more than 1m new homes by 2026. Some £24bn has been earmarked for housing projects and initiatives over the next five years.
Heat Pumps
Another ‘greener’ move will see landlords able to access grants of up to £5,000 to install heat pumps. Heat pumps work by transferring the heat energy from outside a property (either from the ground or the air) into your home via a series of coils. The energy can then be used to run the central heating and hot water system.
Heat pumps create a lower carbon footprint than gas fired central heating (which is used in 85% of all rental properties in the UK) as they don’t need to burn any fuel to heat the home.
Universal Credit
Further changes have been announced to the system of Universal Credit (UC), which could benefit tenants (and some homeowners) across the UK. The temporary £20 a week uplift to UC, which was brought in because of the coronavirus pandemic, has now come to an end. However, the Chancellor is spending more than £2bn a year in reducing the taper rate on UC from 63% to 55%. The taper rate is the rate at which UC claimants lose benefits when they are working.
Independent Estate Agents Maunder Taylor
If you are looking to buy or sell a property in Totteridge, Whetstone, Potters Bar and the surrounding area, then Maunder Taylor, who are independent estate agents based in Totteridge, can offer a complete service.
We also specialise in commercial property lets and investments in Barnet, Potters Bar and other parts of Hertfordshire and North London; our extensive database means we can find the right premises for you, whether you want to invest directly or would prefer to spread the risk by becoming a shared investor with other individuals.
If you would like to know more about any of our services, follow this link and fill in the form; you can also call our Whetstone office on 020 8446 0011 or our Potters Bar office 01707 665 666 if you have any residential management queries.