Image by Dan Johnston from Pixabay
The level of uncertainty and speculation has come to an end, and there is now a clearer view on the policies that the new government is introducing. The Autumn Budget 2024 has landed, and with it comes a wave of economic changes that could significantly impact your UK property investments. Those who are now investing in UK property are now in the position to make informed choices. Here are our key takeaways from the 2024 UK autumn budget.
The UK Economy & Investing In UK Property
The Independent Office for Budget Responsibility has recently adjusted it’s forecast for the UK economy to predict that the economy would grow by 1.1% this year (2024-2025), up from its previous prediction of 0.8%.
Chancellor Rachel Reeves said the ‘Office for Budget Responsibility predict the economy would grow by 2% in 2025’. Of course, it is challenging to predict long term economic trends, but this marks some positive news in the short term for the UK economy and for those buying property in the UK.
It also offers those who are planning to relocate to the UK a greater financial security and less risk when looking at buying UK property, as when paired with other details from the budget, there is a greater incentive for global investors.
Reeves also stated in her autumn budget that she would catalyse “£70bn of investment’” in the UK through a new National Wealth Fund that will transform planning rules to ‘get Britain building’. Marking a great change for property investment companies in the UK.
Reeves said of her plan that “the only way to drive economic growth is to invest, invest, invest. There are no shortcuts. To deliver that investment, we must restore economic stability... This budget will permanently increase the supply capacity of the economy, boosting long-term growth.”
The Labour Government's Plans For Housing
Labour have been very clear with their ambitious house building plan – to deliver 1.5 million homes across the UK, a substantial plan for those who invest in real estate in the UK.
In her first UK budget, Chancellor Reeves committed to more than £5bn of investment in UK property over 2025-2026.
In the autumn budget, Reeves also announced a range of measures to support this ambitious target, including skills training for young people and broad reforms to the planning system that affects local planning authorities.
The Labour government have promised to accelerate large property sites that are “stuck in the system”, and work to “boost and upskill local the local planning authority capacity to deliver the government’s wider reform agenda.” Additionally, Chancellor Reeves committed to £3bn of support for the UK’s build-to-rent sector, something that all property investment companies in the UK would have been delighted to hear.
Historically, the UK property market has performed well under Labour governments and the new autumn budget does look promising for those who wish to invest in UK property or who are thinking about buying property in the UK.
Key Takeaways: UK Budget And Property Investment
We have broken down the parts of the UK autumn budget that affect people who are investing in UK property. As one of the leading property investment companies in the UK, we want to ensure that our investors say up to date with key information that may affect their investment decisions so that they can make the most informed choices.
Stamp Duty Increase For Second Homes And Buy-to-Let Properties
The most significant change from the autumn UK Budget is the Stamp Duty increase on additional properties from 3% to 5%. Effective immediately, this hike raises acquisition costs for landlords and second-home buyers. For those investing in UK property, this could mean an additional £7,000 in Stamp Duty. This shift aims to level the playing field for first-time buyers, but may result in a tighter rental market that may potentially push rents higher. Investors can use our stamp duty calculator to understand what this may mean for them in the long term.
Support For First-Time Buyers And Owner-Occupiers
In a bid to ease entry for first-time buyers, the Labour government has retained current reliefs allowing zero Stamp Duty on properties up to £425,000. However, this threshold is set to reduce to £300,000 next year (2025-2026), indicating a potential short-term boost in demand from first-time buyers looking to capitalize on the higher threshold.
Capital Gains Tax And Inheritance Tax Stability
No changes were made to Capital Gains Tax on residential property in the new UK budget. This helps in providing some stability for people investing in UK property. Inheritance tax reforms, while anticipated from this budget, were not as drastic as expected. This stability offers UK property investors who are planning to hold onto their assets long-term some relief amidst broader fiscal tightening.
Green Initiatives and Energy Efficiency for Rental Properties
It was announced in the budget that additional support for energy-efficient improvements includes grants and tax incentives. These measures align with the requirement for rental properties to meet a minimum EPC rating of "C" by 2030. People buying property in the UK who are focusing on sustainability may find opportunities here, although meeting these standards could mean upfront costs for landlords.
Thinking About Investing In UK property?
If you are considering buying property in the UK or want to invest in UK real estate, then take a look at our Investor Series. Our Investor Series contains a host of webinars and guides that you can download and learn from to ensure that you are making the most informed choices for your property investment portfolio, and if you have any further questions, we’re right here to help you get the answers you need. Contact us today for further information.
Take Me To The Investor Series
Impact Of The UK Budget On The Rental Market
Increased acquisition costs and regulatory changes could lead to a decline in new buy-to-let property investments in the UK, tightening rental availability. This reduced supply may drive up rents in an already competitive rental market, potentially straining tenant affordability.
What Does The 2024 Autumn UK Budget Mean For Those Investing In UK Property
This budget’s emphasis on reducing competition between first-time buyers and people who invest in real estate in the UK may help to level the UK housing market, yet it also adds complexity for property investors looking to expand their property portfolios. As one of the leading property investment companies in the UK, we know that strategic planning and an awareness of key government incentives, like green grants, are essential when navigating these changes and buying property in the UK. If you have any questions or would like to contact us about investing in UK property, please get in touch today.
Our Available Properties
Contact Us
As one of the leading property investment companies in the UK, there are many ways we can help those investing in UK property or people who are considering buying property in the UK. Let us answer your questions or find the perfect property for you.
Relevant News & Insights
Want to know more about the UK property investment market or gain some tips on starting out with property investment in the UK. Take a look at our other articles and guides:
