hancellor Jeremy Hunt dodged the opportunity to urgently boost housing supply and tackle double digit rising rents for young tenants in London, in a Spring Budget that was billed as helping Britons “everywhere”.
Unusually, his address this week did not include any housing market announcements. Mr Hunt entirely failed to increase the much-needed supply of affordable, starter and family homes to buy or rent. In fact, he also omitted any mention of the Conservative Party’s 2019 manifesto pledge to build 300,000 new homes per year.
“The omission of housing policy is a dramatic shift from the budgets [and Autumn Statements] of 2018 and 2019 when housebuilding and home ownership were at the forefront of Government strategy and a vital part of the growth agenda,” says Emily Williams, a research director at Savills.
This abandonment of the residential property agenda comes at a time when multi-bedroom houses in London have risen in value by 24 per cent since 2019 taking them to an average price of £873,390. Rents have jumped by 13.8 per cent in the 12 months to February 2023 (Hamptons), rendering life in the capital unaffordable for many.
“The housing market is a significant contributor to the economy, and it is hard not to feel the Chancellor missed a trick in failing to introduce any measures to stimulate activity,” says Mark Harris, chief executive of mortgage broker SPF Private Clients.
Nimbyism and MP rebellions stifle home building
The cost of accommodation is yet another strand of the cost-of-living crisis but, unlike childcare costs and energy bills, one that has been ignored. The Office for Budget Responsibility, as referred to heavily in the Budget, has forecast that real disposable income will fall by 5.7 per cent by 2028, a record drop, making it even harder in London to cover rent and save for a deposit.
Williams attributes this inertia in