Scarcely had the Chancellor sat down from delivering his 2011 budget when RICS produced an in-depth analysis of the proposals. George Osborne’s first budget contained an unusually strong focus on the property sector, with the Chancellor appearing to heed the recommendation of the RICS by outlining reforms to stamp duty and Real Estate Investment Trusts (REITs), in order to support investment in house building.
The following morning I was honoured to be able to host an RICS Budget Briefing Breakfast, at which senior representatives from across the land, property and construction sectors heard from John Plender, Senior Editorial Writer and columnist at the Financial Times, and Simon Rubinsohn, Chief Economist for RICS.
The event provided a superb opportunity to discuss the impact of the budget announcement in the immediate aftermath and further emphasised the importance of the land, property and construction sectors in driving an effective and sustainable economic recovery.
Amongst the many talking points, there was a general consensus that releasing pent-up demand from first-time buyers into the housing market would lead to job growth in the construction industry. Other initiatives, such as “buy now-pay later” schemes for public land, and investment in sustainable technology through the Green Investment Bank were also welcomed as important steps forward.
However, caution was urged over the introduction of Enterprise Zones which have, in the past, produced mixed results. The tendency to transfer problems from one area to another and the substantial funding needed for infrastructure development were highlighted as potential concerns.
The Change of Use Classes Order generated some discussion amongst attendees, with particular emphasis being placed on the need for an adequate supply of commercial property in order to support growing businesses as the economy recovers. The effectiveness of land auctions as a tool to boost development was also questioned, and it remains to be seen whether it will bring more land forward.
I, for one, found it really stimulating to chair debate among such a diverse range of leaders from across the property spectrum. There was an obvious desire across sectors to support the economic recovery through informed debate and collaboration. RICS will continue to work with HM Treasury on budgetary issues to help the UK economic recovery and move towards a vibrant and sustainable property market.