Rachel Reeves' Autumn Statement reveals a focused commitment to economic growth, housing accessibility, and regional infrastructure improvements, with several key measures that impact the planning and development sector. We've summarised these here for you.
Housing and Affordable Homes Expansion
With a focus on increasing homeownership, the Higher Rates of Stamp Duty Land Tax for additional properties will rise from 3% to 5%, prioritising first-time and primary residence buyers over those purchasing second homes and buy-to-lets. This is projected to increase the number of transactions by 130,000 over the next five years for new homebuyers.
The Budget has earmarked £500 million to boost the Affordable Homes Programme, setting a target of 5,000 new affordable homes and raising the programme's annual budget to £3.1 billion. The government is also addressing long standing obstacles like nutrient neutrality with £47 million allocated to local authorities to expedite the delivery of 28,000 homes in stalled developments.
Further, new housing guarantee schemes will inject £3 billion in support for SMEs and the Build to Rent sector, aimed at sustaining private market growth. In tandem, councils will retain 100% of receipts from Right to Buy sales, supporting reinvestment in affordable housing stock.
For property developers, these changes create a more favourable environment for affordable housing and first-time buyer projects, with increased funding and support for developments that align with government priorities. The additional £3 billion for SMEs and Build to Rent offers developers enhanced access to capital, while expedited approvals for stalled projects can lead to faster project timelines and reduced financial risks.
Infrastructure Development and Regional Growth
The government's approach includes a substantial £13 billion capital investment in infrastructure next year, setting a total capital expenditure of £131 billion by 2025-26. This will include funding for crucial transport projects like the TransPennine route, East West Rail and HS2, and the establishment of the National Infrastructure and Service Transformation Authority (NISTA) to strengthen project delivery nationwide.
For regional growth, an integrated settlement initiative will begin in Greater Manchester and the West Midlands from 2025-26, extending local funding control to mayors, with other regions set to join in 2026-27. A £56 million investment at Liverpool Central Docks will support 2,000 new homes and related commercial facilities, while the Oxford-Milton Keynes-Cambridge corridor will see £10 million invested in planning for transformative infrastructure growth.
So, how does this pact you? Well, this significant infrastructure investment and regional growth initiative signals new development opportunities, particularly in regions receiving targeted transport and funding support. With improved connectivity and the empowerment of local authorities to manage project funding, developers can anticipate faster approvals and a more supportive environment for residential and commercial projects in growth corridors.
Long-Term Housing Market Stability
The government will introduce a new social housing rent settlement of CPI+1% over five years, providing clarity for social housing providers and long-term certainty for residents. Additional consultations may extend this to a 10-year model, offering an unprecedented level of financial stability in the sector.
In alignment with evolving housing needs, £46 million has been allocated to boost the capacity of local planning authorities, supporting the recruitment and training of 300 graduates and apprentices, and expediting larger developments.
For property developers, the new social housing rent settlement ensures greater predictability and financial stability for projects in the social housing sector, making long-term planning more viable. Additionally, the £46 million investment to enhance local planning authority capacity promises faster processing times and support for larger developments, reducing bottlenecks and potentially accelerating project timelines for developers.
Planning System Reforms
The government will deliver further reforms to the planning system through the forthcoming Planning and Infrastructure Bill, aimed at simplifying processes in response to the recent National Planning Policy Framework (NPPF) consultation. With an additional £5 million set aside for Nationally Significant Infrastructure Projects and a commitment to address legacy issues like nutrient neutrality, these updates are designed to streamline planning and increase development efficiency.
In summary, the upcoming Planning and Infrastructure Bill offers developers a promising simplification of planning processes, which could reduce delays and make project management more efficient. The extra £5 million allocated for Nationally Significant Infrastructure Projects, as well as measures to address legacy issues, further supports faster, more predictable planning outcomes, allowing developers to advance projects with fewer regulatory hurdles.
Capital Gains and Inheritance Tax Adjustments
The government has announced an increase in Capital Gains Tax (CGT) rates, raising the lower rate from 10% to 18% and the higher rate from 20% to 24% as of October 2024. Inheritance tax thresholds will remain frozen until 2030, while reforms to agricultural and business property relief will phase out the current 100% rate after £1 million in assets, applying a 50% relief rate on remaining amounts. These measures are positioned to drive fiscal stability while preserving some support for family-owned farms and businesses.
For property pros, the increased CGT rates may prompt a re-evaluation of portfolio strategies, especially for those managing long-term investment properties. The phased reduction in agricultural and business property relief also impacts developers working with family-owned land or rural assets, assessing potentially increasing tax liabilities on higher-value properties. These changes highlight the importance of proactive tax planning to mitigate financial impacts and adapt to the evolving fiscal landscape.
Budget Summary Mania
Following the Autumn Statement there seemed to be an avalanche of summaries and opinion pieces about what it all means, and yes - we see the irony. Here are some links to a few of our favourites:
Lichfields: Autumn Budget 2024
Irwin Mitchell: Budget 2024: Planning & Social Housing
The Budget makes clear that housing, development, and regional growth are central to the government's vision. With targeted tax reforms, substantial infrastructure funding, and a reinforced planning framework, the path is set for more sustainable, accessible housing and robust regional economies across the UK.
Whatever stage you're at in your development process, and however the Budget has affected you, LandTech's products will be able to help. From site sourcing and assessment to funding and community consultation, get in touch with our team to see how LandTech can help.
