The Chancellor’s surprise announcement to bring in the Help-to-Buy scheme was welcomed by the property and construction industries – with housebuilders in particular enjoying some rare good news.
The property sector in the West picked up on some of the positives – but like most other industries, considered that more could have been done to boost confidence and get the economy moving again.
Jeremy Richards, head of surveyors Jones Lang LaSalle’s Bristol office, said: “From an occupier standpoint, it is disappointing to see that economic growth forecasts have been halved as this will impact sentiment in terms of investment in the UK. It is also disappointing that the Budget contained no news on how the Government will allocate resources to regional LEPs through the Heseltine Review.
“However, we welcome measures to open Britain’s doors to more international business, such as cutting Corporation Tax to 20% from April 2015, making it the lowest business tax of any major economy in the world.
“The Help-to-Buy scheme, with its £130bn of Government-backed mortgages, can only be good news for construction firms and will help stimulate the housing market. Boosting infrastructure by £3bn a year is also welcome – the construction industry tends to have very UK-based supply lines, meaning that benefits do not ‘leak out’ and increase exports.
“We also welcome the Chancellor’s desire to make Britain the most internationally-attractive place to innovate. In the West we are home to some of the sectors the Chancellor recognised in his Budget speech as experiencing global success, putting our region in a strong position.”
But Leigh Richardson, director at the Bristol office of commercial property adviser GVA, said the Budget had been a major opportunity missed to use business rates to stimulate the economy and help businesses.
“We are disappointed but not surprised that rate bills annual increases have not been moved from the RPI to the lower CPI inflation index from 2014, which would have cut bills by between 1%-2%,” he said.
“No U turn on delaying a revaluation to 2017, which fails hard-pressed business. This Budget also includes no major overhaul to empty rates which the Government continues to employ as a blunt instrument to raise £1bn additional tax revenue, significantly adding to the cost of holding all time high levels of vacant property.”
Tim Davies, head of Colliers International’s Bristol office, welcomed some measures.
“George Osborne announced a number of measures that will significantly boost the construction and housing sectors,” he said. “All the measures however were reliant on borrowing from the Government to drive them through.
“The Help to Buy proposals will reduce the barriers to home ownership for those seeking to get on to and then climb the housing ladder.
“In doing so, this will unlock sites with existing permissions that were previously undeveloped due to lack of access to finance for would-be purchasers. This is great news if you are a developer that has an ‘oven-ready’ site.
“Overall, it remains to be seen what impact increased homeownership opportunities will have on housing affordability and meeting identified need.”
He said there was also a bigger question about where growth will be directed in the longer term. There was a need for national guidance to direct investment in the medium and long-term and perhaps now was the time for a national spatial plan to address this.
Colliers Bristol office’s hotels director Peter Brunt welcomed the 1p cut in beer duty and the scrapping of the beer duty escalator, saying it would bring much-needed relief to the West’s ever-squeezed pub and brewing sector, as thousands of jobs had been threatened by the planned 6p a pint increase.
“After months of lobbying, the Chancellor has finally listened to the united voice of the industry, consumers and the media to come up with a welcome measure of good news in these difficult times,” he said.
“Although we continue to experience healthy demand for pubs and hotels coming to the market in the West, the industry as a whole has been rocking and this glimmer of good news in the Budget will come far too late for many.
“We are also hearing that a number of the micro breweries which have sprung up in the last few years have also been placed under great pressure by the beer duty escalator and they will not be sad to see the back of that particular device.
“The decision to raise the tax personal allowance to £10,000 will also help the lower paid in particular, for whom a couple of pints in their local pub is one of life’s few affordable luxuries.”
