The Chancellor’s “modest” Spring Statement has been met with widespread approval from the mortgage industry, despite containing little in the way of policy change.
Many welcomed the Chancellor’s announcement that funding Housing Growth Partnership for small housebuilders will increase.
Hope Capital chief executive Jonathan Sealey says: “It is positive news that funding for this partnership will be more than doubled to £220m. It is these smaller developers and housebuilders that often turn to bridging funding to get their developments off the ground.”
There was also positive feedback on the Chancellor’s update on the number of first-time buyers who have made use of the stamp duty exemption.
According to the chancellor 60,000 first time buyers have benefited from this change, which was introduced in the last Budget.
Just Mortgages group operations director John Philips says: “Last year saw the highest number of first time buyers in a decade and January this year a 7.7 per cent rise in gross mortgage lending.
“At the time I said this was likely a combination of low rates, the Help-to-Buy scheme and the stamp duty changes announced in the last budget.
“We can now see that these stamp duty changes have in fact had a huge impact on the market.”
Mortgage broker Private Finance director Shaun Church says: “The cut to stamp duty is helping to ease the climb onto the property ladder for thousands of first-time buyers.”
However, Church says he was disappointed that this hasn’t led to further stamp duty reforms for those further up the property ladder.
As he points out the prohibitively high cost of moving is continuing to dampen activity in this end of the market, which is having a trickle-down effect further down the chain.
Lenders and brokers were pleased to see the Chancellor reiterate his pledge to boost house-building and by ensuring there are 300,000 new dwelling a year build by the mid 2020s. In the last Budget he announced a £44bn fund to support this house building initiative.
But while there was widespread support for this aim, many want to see these promises backed by more concrete action.
Emoov’s founder and chief executive Russell Quirk says: “We still haven’t seen the delivery of promises from previous budgets, so only time will tell if these words will actually equate to action.”
Quirk welcomed the Chancellor’s announcement that there would be 215,000 new homes within the West Midlands region by 2031, with the local authority getting a £100m grant from the land remediation fund.
But Quirk was less impressed with the Chancellor’s pledge to increase the number of affordable homes in the London.
He says: “While the commitment to build 26,000 affordable homes in the capital – and a total of 116,000 affordable homes by 2022 – would be a step in the right direction, the government delivered just under 7,000 affordable homes in 2017. There is a large gap between their good intentions and reality and this is simply not adequate enough to fix London’s broken housing market.”
Other industry experts also said this Spring Statement was a missed chance for more decisive action to fix the housing crisis in the UK.
Phoebus Software sales and marketing director Richard Pike says: “The most frustrating thing for many following today’s speech is that we will have to wait until the Budget in November to find out how the government intends to tackle the gap from planning permission to build completion. This issue is one that really needs to be undertaking sooner rather than later so that land banking becomes a thing of the past.”
This more critical view was shared by bridging lender Market Financial Solutions. The company’s chief executive Paresh Raja says: “Today’s modest, if not lacklustre speech offered few meaningful solutions to the long-term challenges facing the property market.
“The underlying problems such as housing supply won’t wait until the Budget in the Autumn. Yes, the Chancellor reiterated that £44bn was available to help hit new-build targets, but today’s announcement could have taken further steps towards developing a successful plan for helping more people get on or move up the property ladder.”
However, others welcomed this laissez-faire approach. Lendinvest’s chief commercial officer Matt Tooth says: “The absence of a major policy shakeup is precisely what the industry needed.
“Rather than wasting time adapting to the step changes we’ve become used to seeing, lenders and developers alike can get on with what they do best, getting more homes built across the UK.”