What were the key March Budget pledges for UK new homes?
There were no headline measures aimed at first time buyers, but east London secured some targeted funding for new homes and a life sciences hub, while first steps were taken towards an ‘accelerated planning service’.
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Crucially, there were no new schemes or support for first time buyers – or an extension of relief from stamp duty.
As things stand, this means the stamp duty holiday for first-time buyers who currently pay no duty on the first £425,000 of a home purchase up to the value £625,000 will end in April next year.
But chancellor Jeremy Hunt did outline targeted funding for new homes in east London. Barking and Canary Wharf were allocated £242m to build a combined 8,000 homes, the overwhelming majority in Barking Riverside (7,200), with the financial district getting more of a life sciences boost with a new hub, commercial and retail space and a healthcare diagnostic facility.
Additionally, Hunt announced a £20m fund to support the development of community-led housing schemes.
But these clearly do not address the nation’s wider housing issues, with other major regeneration projects still at early stages.
Cambridge was promised £10m over the next year for local transport and health infrastructure. But a longer-term funding settlement for its future development corporation will not be unveiled until the next Spending Review.
The Budget document also referenced the government’s plans for up to 10,000 new homes in London’s Euston and 20,000 in Leeds.
Accelerated planning?
Perhaps more impactful, as part of the Budget day announcements, was the Levelling Up department’s launch of a new consultation on accelerating the planning system, which is open until 1 May 2024. The proposals, aired in the Autumn statement, includes a new accelerated planning service for major commercial applications with a decision time in 10 weeks and fee refunds if this is not met.
While this does not yet entail residential developments, the consultation says that over time the government is keen to extend the so-called ‘Accelerated Planning Service’ to both major infrastructure and residential developments.
The consultation will also look at scaling back the use of extensions of time, also potentially significant for residential development given these are frequently used by the sector.
Official data on major residential planning decisions in England are categorised as being ‘within 13 weeks or agreed time’.
So you cannot currently see what proportion go over the 13 weeks.
Brownfield regeneration
The government had already trailed a push on brownfield housing development prior to the Budget.
So, these latest announcements add only a layer of extra detail which is welcome news for east London but not enough to address the fundamental issue of low housing supply across the country, and the rest of the capital.
Barking Riverside, a partnership between L&Q and the Mayor of London, is one of Europe’s largest brownfield development projects (see map), with a masterplan for more than 10,000 homes and seven new schools.
Around 2,400 homes have already been delivered.
A recent plunge in construction starts across London means that the availability of new housing is becoming increasingly scarce.
Last year, the number of units started on schemes of 20 plus dwellings fell to a thirteen-year low in the capital to just over 12,000 homes.
