Spring Budget 2024: Everything You Need to Know

The much-awaited Spring Budget 2024 by Chancellor The much-awaited Spring Budget 2024 by Chancellor Jeremy Hunt attracted a lot of attention, especially in relation to housing and property issues. Potential fixes for problems affecting homeowners, renters, and potential purchasers piqued the interest of stakeholders and investors.

It's critical for us to keep up with any developments that can have an influence on our interests as real estate investors. Let's examine the key announcements and how they affect the real estate sector. attracted a lot of attention, especially in relation to housing and property issues. Potential fixes for problems affecting homeowners, renters, and potential purchasers piqued the interest of stakeholders and investors.

So let’s go over some of the things that were mentioned that we need to know about as property investors:

Lowering of the Capital Gains Tax

The reduction of the higher rate of capital gains tax on real estate from 28% to 24% was one of the noteworthy developments for investors. By encouraging investors to take part in sales, this initiative aims to accelerate real estate transactions.

While some viewed this tax cut favourably, seeing it as a spur to market activity, others cast doubt on its capacity to materially alter landlord behaviour, particularly in light of the added regulatory obstacles facing real estate investors.

Furnished Holiday Let Changes

The Furnished Holiday Lettings tax regime was eliminated in the Budget in an effort to address the issue of short-term rentals. This action demonstrates the government's resolve to realign the housing market such that long-term renting options for local residents are given precedence.

However, there are also concerns about unforeseen consequences and gaps in the law, particularly as they relate to short-term rental companies and the larger hospitality sector.

It's important to note that this adjustment matches the tax obligation proportionately with revenue from other real estate assets rather than imposing an additional tax on income from furnished vacation rentals.

Relief from Stamp Duty on Multiple Dwelling

There was much expectation for new programmes to assist first-time homebuyers and provide tax breaks. However, the Budget made an unexpected turn by doing away with the Multiple Dwellings Relief from stamp tax.

Even if the goal was to stop abuses in the private rental market, many in the real estate business were disappointed by the decision and yearned for more targeted approaches to improve the dynamics of the housing market.

The dynamics of decision-making for both buyers and sellers may be greatly impacted by the removal of these reliefs, particularly in transactions involving several properties.

Abolishing Non-Dom Tax Status

The removal of the non-domiciled tax structure, which signalled a shift to a residency-based system, was a significant disclosure. This change has implications for the luxury real estate market, which is often reliant on foreign capital. Even while the Chancellor has been highlighting the economic benefits associated with this change, concerns remain about how it would affect confidence among foreign investors.

Plans for Regeneration

The Budget highlighted significant investments in redevelopment projects in London and other key cities, including Barking Riverside and Canary Wharf. These initiatives aim to address the scarcity of housing and revitalise urban environments, offering opportunities for real estate developers and financiers.

Furthermore, the introduction of a £20 million Community Led Housing fund highlights the government's commitment to supporting community-led initiatives and giving local communities a significant voice in shaping their residential landscapes.

There is no change to the lifetime ISA cap

No changes were made to the Lifetime ISA cap for first-time buyers, despite rumours to the contrary. Chancellor Hunt emphasised the need for caution when making changes to housing policy, indicating a preference for broad reforms over small-scale tweaks.

No 99% Mortgage Scheme

Pre-budget leaks revealed plans for a government-backed 99% mortgage scheme that never came to pass. The plan, which was meant to help first-time buyers by reducing deposit requirements, ran into opposition and eventually was shelved.

And…. that’s it! Stay tuned for more investment updates