What does the autumn statement 2016 really mean for housing and construction in the UK?
The autumn statement is the second big economic statement of the year from the government and given that this is the first from the current chancellor (Phillip Hammond). It has also acrried a very Brexit loaded rhetoric to ensure the UK economy is ‘match fit’!
Here is a snapshot extract relating to this article:
- UK is the fastest growing major economy in 2016
- Infrastructure investment to rise to between 1% & 1.2% of GDP from 2020
- 2017 growth revised to 1.4% from original forecast of 2.2%
- £1bn funding for digital infrastructure (including 5G mobile)
- Extra £2bn a year for research and development
- £1.4bn to help build 40,000 new affordable homes in England ‘housing market that works for everyone’
- £2.3bn for infrastructure in areas of high demand for new homes
- Unlock more land for housing
- Extra infrastructure spending will increase to devolved nations
- £23bn for new national productivity investment fund over next 5 years
- £1.1bn investment in local transport networks in England
- £220m to address traffic pinch points on strategic roads
- New £6.7bn package to reduce business rates
- Corporation tax to fall to 17%
- £1.8bn from local growth fund for infrastructure in England regions
- Letting agencies in England to be banned from posing upfront fees on tenants
Whilst the overall sentiment from the goverment towards addressing housing and infrastucure challenges in this country are bullish, the reality is that these plans will take a number of years to physically resinate. This will undoubtadly continue to push prices towards the same upward trajectory which will prove to be advantageous for investors and unfortunately, widen the gap for the first time buyer proportion of the population as the prices continue to rise. The cost of an average home in the UK is estimated at around £218,000 — according to the latest official figures. This valuation represents a rise of £16,000 comapred to the previous year. every first time buyers will need to find an average deposit of about £33,000 to secure financing against a property valuation of £218,000.
The chancellor, by his own admission, stated that for many home ownership “remains out of reach”, with a pressing need for affordable housing. Thompson McCabe will publish an article within the coming days which will include an in-depth insight into how the quinessetial twenty to thirty something year old can progressively reach this target of £33,000. Our intention is to simply add value to each and every reader and help them reach financial freedom by owning their first home… STAY TUNED!
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