The second budget of the year saw investment in housing but any changes to property taxation were largely absent.
On 27 October 2021, Rishi Sunak announced the Government's plans for the UK's spending over the next year.
Taxation
On the latter, there were no changes to Stamp Duty Land Tax after the end of the successful holiday scheme and no commitment to review the tax going forward.
Housing
Housing was on the agenda, with building more homes listed as one of the areas where taxpayers’ money would be spent to make the most difference to people’s daily lives.
Addressing the UK’s shortage of homes has long been on the political agenda but Government targets for building new properties have been consistently missed, so while the investment will be welcomed, it is unlikely to be seen as enough to tackle the issue.
When viewed alongside fundamental drivers of demand like a growing and ageing population and increasing number of households, this means that the place of the PRS in providing decent, affordable homes will remain.
Cladding
The Chancellor announced £5bn will be made available to remove unsafe cladding from the highest risk buildings, partly funded by the Residential Property Developers Tax. This tax, introduced in April 2022, will be charged at 4% on property develop profits exceeding an annual allowance of £25 million.
Levelling up
We’ve already seen an increasing amount of buy-to-let investment in the north of England, landlords modifying portfolios in response to strong demand and drawn by the ability to achieve good yields, and this latest spend could eventually improve the appeal of some areas that are currently not seen as desirable, potentially making them attractive investment opportunities.