Chancellor Hunt Slashes Taxes on Property Sales 2024

London's residential development sector has offered a nuanced response to the recent Spring Budget announced by the Chancellor, expressing both appreciation and disappointment. The highlight of the budget for the sector was the reduction in the tax rate on profits from house sales, although this was met with mixed feelings.

Chancellor Jeremy Hunt revealed plans to decrease capital gains tax on house sales from 28% to 24%, alongside the removal of a tax relief on stamp duty utilized by landlords for bulk property purchases. Additionally, Hunt announced a substantial £240 million investment in housing projects within Barking Riverside and Canary Wharf, expected to yield approximately 8,000 homes and a life-sciences hub.

Despite Hunt's portrayal of the budget as tax-cutting critics pointed out that many individuals would still face rising tax bills due to the freeze in personal allowance thresholds. Hunt asserted that these actions were aimed at immediate housing supply enhancements, aligning with the government's long term plan for housing. 

The decision to scrap the multiple dwellings relief, intended to bolster the build-to-rent sector, came after an evaluation revealing its inefficacy in stimulating private rented sector investments.

Nicky Stevenson, managing director at Fine & Country welcomed the reduction in capital gains tax, anticipating a surge in property listings as hesitant landlords gain confidence. Conversely, Mark Washer, CEO of Sovereign Network Group, criticized the budget for overlooking the significant societal and economic costs associated the increasing number of children residing in temporary accommodations. 

Mike Burton, land director at Metis Homes echoed sentiments of disappointment, stating that the budget lacked substantial measures to support the housing industry as a whole, especially for first-time buyers. 

While the budget outlined various investments and initiatives, including funding for housing projects in key areas and alterations to capital gains tax, some stakeholders feel more comprehensive support is needed, particularly to aid prospective homeowners and stimulate industry growth. 

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