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Will Chancellor Hunts Budget dare help the rental sector

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Wed 08 Mar 2023

Will Chancellor Hunts Budget dare help the rental sector

A prominent lettings agency chief wants a raft of measures to help the private rental sector and investors in next week’s Budget - but he’s now holding his breath that his call will be heeded.

David Alexander, chief executive of DJ Alexander Ltd, says there is speculation that Chancellor Jeremy Hunt has more money available than expected, and says that while he is likely to spend some of this in maintaining the subsidy on household energy bills it would send a positive message if he singled out the housing market for additional support. 

“Although I acknowledge that the Chancellor is unlikely to do this it would also be beneficial to the housing market to provide greater incentives to encourage investment in the private rented sector to ensure we have a stable market able to provide sufficient homes for the population in the future. 

“The private rental sector is an integral part of the housing market yet it can often feel neglected by politicians. Greater understanding of its importance in providing homes for millions of people is overdue and incentives to remain in the market and invest for the future would be welcome.

“The continued freeze on the threshold for Inheritance Tax remains at £325,000 which means that if this rate had kept pace with inflation since it was introduced in 2009, it should, by January 2023, be at £474,715. However, with IHT receipts for April 2022 to January 2023 reaching £5.9 billion, which is £0.9 billion higher than in the same period a year earlier, it seems unlikely the Chancellor will forsake this financial gift which keeps on giving.”

Alexander says that as a boost to the housing market, Chancellor Hunt could ease planning regulations to make it easier for new homes to be built. Providing tax incentives for builders and property investors would give further impetus to produce more homes. 

This would, in turn, increase capacity which would stabilise house prices in the future and make it easier for first time buyers to get on to the housing ladder.

“If this was done whilst also initiating a major boost to the building of more social housing then we would see the whole housing market experience a correction and begin to function more effectively in delivering quality homes for the wider population. Of course, this would not apply in Scotland, but I would hope that if such an initiative was delivered in England it would nudge the Scottish Government into replicating such a move” says Alexander, whose company - part of Lomond - is based north of the border. 

Alexander concludes: “The Conservative party has long been known as the party of home ownership yet there have been times in recent years when it hasn’t felt like that. A move to support the housebuilding sector coupled with some direct relief for homeowners in terms of stamp duty and IHT would keep the market buoyant in the next couple of years and provide a feelgood message from a government facing a tricky general election in around 20 months’ time.”