What does The Budget mean for the Property Market?
Tim Foulkes Senior Partner of Howard Cundey takes a look at this year’s spring Budget and wonders how it may affect the property market.
I suppose that the 2016 Budget was never going to be too contentious or radical in view of the upcoming European referendum in June. Certainly there was little mention of housing in the Budget. Perhaps the Chancellor felt he had done enough recently by attaching additional tax to buy-to-let and second homes – creating the current storm of activity in the property market from those attempting to beat the tax axe and complete purchases before 1st April.
But other areas of the Budget do remind us of the effects that economy and infrastructure have on the housing market. For instance by creating better road and rail networks local housing receives a boost in demand. But major rail schemes like High Speed 2 and 3 in the Midlands and the North and Cross Rail 2 in London, and road route improvements such as a Pennine tunnel are very long term, and the beneficial effects on house prices will take a great deal of time to make themselves felt.
Yet we don’t need these huge projects to influence housing at local levels. House owners and buyers should always keep a close eye on smaller local schemes and improvements. Changes for the better in transport, jobs, education, business and health have an immediate and positive influence on the demand for local housing both in the rental and sales sectors – evidence the influence a good state school has on housing within its catchment area.
As a well-established estate agency business with its roots in the local community and with long-held local knowledge and deep understanding of regional affairs, we can always point buyers in the direction of those areas due to benefit from modernisation and improvement. This knowledge makes property investment in these areas potentially more beneficial as an appreciating asset than other long established, popular and sought after locations.
The Chancellor may not have done much directly to or for housing in this Budget. But other measures he has made will have a significant effect over time.