The chancellor John Healey’s first Budget has received a mixed response from senior figures from across the built environment industry.
Many of the measures unveiled by Healey, such as an extra £1bn for social and affordable housing in England, had already been trailed in the build up to the Budget.
On the contentious issue of business rates, the chancellor confirmed the threshold at which high street shops would start paying rates in England would increase from £12,000 to £18,000.
Healey also announced all business rates would be retained locally by the end of the decade, with mayors to keep 20% of revenue from next year. This is all part of the government’s devolution push with regional bodies and mayors in England to get greater powers over spending.
On the housebuilding front, the chancellor revealed more details about the Your First Home scheme and he also unveiled plans to introduce an ISA for first time buyers. Other measures included more than £600m of investment in projects related to AI, plans to scrap standing charges on household gas bills and the introduction of a new data centre ‘covenant’.
Industry reaction to the Budget:
Justin Young
Chief executive
RICS
“This is a Budget that addresses some of the key challenges the built environment has been raising – from housing viability, to supporting first time buyers, and boosting the high street. We welcome the chancellor’s acknowledgement of the financial pressures on developers and housebuilders. The government’s decision to pause new regulations other than those for safety will be welcome news for housebuilders in the face of growing economic pressures. However, we recognise viability changes cannot come at the cost of building safety, quality or the environment.
“The announcement of a new dedicated first time buyer ISA could be very positive news for the wider housing market if it will provide support for first time buyers of existing properties, something RICS has been calling for in addition to the Your First Home scheme, which only applies to new build homes. As the government publishes its long-awaited high streets strategy, support for smaller businesses and high streets will be widely welcomed.
“Yet, fundamental reform of the business rates system to unlock investment and growth is still needed to ensure a more responsive system that supports long-term economic development in every part of the country. This Budget contains welcome steps in the right direction, and we look forward to working with government to ensure they deliver real benefits for households, businesses and communities alike.”
Vanessa Hale
Chief executive
Real Estate:UK
“This Budget fell short of what’s needed to address the viability crisis blocking the renewal of cities and towns, which has seen property development largely cease in much of the UK. The economic and social consequences of this cannot be overstated, with town centres emptying, new homes not being built, defence facilities delayed, regional office buildings standing empty and logistics and industrial capacity wearing out. It needs urgent and bold intervention and sadly this Budget did not deliver.
“While we support the positive measures around accessibility to homeownership, increased funding for affordable housing, accelerating devolution where real estate has an integral role to play, and the qualified ban on new building regulations, these gains are rapidly being offset by other regulatory burdens, additional taxes, and rising construction and operational costs, all of which the government needs to urgently address over the coming months.”
Paul Rickard
Chief executive
Pocket Living
“This was a broadly positive budget from the perspective of helping to get first-time buyers onto the ladder. However, for people to become homeowners there must be new homes for them to own, which is now the greatest challenge facing both government and the country. There have been welcome moves to reform the planning system, but we remain trapped in a viability doom loop where most parts of the country are seeing almost no new homes delivered due to rapidly rising construction costs and the layering effect of regulatory burdens.
“This is being felt most acutely within the SME housebuilding sector, which is why we are now calling for a distinct regulatory, taxation, and policy regime appropriate to the size and delivery record of SME home builders to help stop the slide towards extinction facing the sector and make the SME development model viable again.”
Olivia Harris,
Chief executive
Dolphin Living
“This Budget brings some positive news for those looking to get onto the housing ladder, especially with the confirmation of the income caps for Your First Home. Less so for renters, and despite the same affordability constraints existing for renters the household income cap for them has not yet been raised. There exists a real need to offer some hope to those unable to access social housing, or afford to rent on the open market, by aligning the income caps for discount market rent to the new cap for Your First Home and ensuring that some of the extra funding for the Social and Affordable Homes Programme is directed towards delivering more discount to market rented homes, especially within London.”
Matthew Allen
Senior executive director at Bidwells and executive director of the Oxford-Cambridge Supercluster Board
“The chancellor’s emphasis on innovation in this Budget is welcome, particularly the government’s shift from funding research to commercialising it. If the state’s biggest buyers If the state’s biggest buyers such as the NHS, the Ministry of Defence and Great British Energy back British scale-ups early, and the Scale Up Fund and pension reforms such as the Mansion House Accord direct more growth capital into UK companies, more of them will grow here rather than leave for the US. Keeping our best companies here also depends on having somewhere for them to grow and somewhere affordable for their employees to live. Grid connections and water capacity should be the next priority for our growing science clusters.”
Ed Hutchinson
CEO
Henry Boot
“Growth in every postcode has to be underpinned by a healthy housing market and the decision to introduce the ‘Your First Home’ package for first time buyers is a step in the right direction towards stimulating demand that creates the conditions housebuilders need to get on and build. This, coupled with improvements to the planning system could result in housing being delivered at speed across the country over the next 12 months, although challenges around persistently higher interest rates, broader economic uncertainty reducing consumer confidence and construction costs remain.”
Nick Sanderson
Founder
Audley Villages
“Supporting first-time buyers is welcome, but you can’t fix the housing crisis by only looking at the first rung of the ladder. A lack of attractive later living options or incentives to move means older people are discouraged from downsizing, locking up the family homes that the next generation desperately needs. A truly effective housing strategy looks at the whole picture. Invest in later living alongside FTBs and unlocking the properties we already have, while building the new homes the country needs.”
Jatin Patel
Head of mortgages, savings and insurance
Barclays
“Cost of deposits remains the biggest hurdle to getting on the ladder, so we welcome targeted measures to support first time buyers, particularly through Your First Home. Its focus on new builds is particularly important, as the demand for energy efficient homes grows. However, success will come down to delivery. The scheme needs to be simple and accessible to those who need it most, while giving developers greater confidence to invest in new supply.”
Anna Moore
Chief executive
Domna
“Scrapping gas standing charges will be welcome news for many households. But these costs are not disappearing. They will end up being shifted onto the price of gas, which means people living in cold, leaky homes could end up paying more simply because their homes need more energy to stay warm.
“This is why the government must not just tackle the symptom, but the cause of high heating bills — our ageing, underinvested homes. We cannot keep shifting charges around while heat escapes through the country’s poorly insulated roofs, walls, and windows. The Warm Homes Plan is welcome but to go even further, removing VAT on the full range of retrofit works would make it cheaper for households and housing providers to invest in warmer, more efficient homes. So too would sticking the landing with higher EPC minimums – mooted to come into force in 2030, but will many important details still to be announced.”
Heather Powell
Partner
Blick Rothenberg
“+2% on rental income really is the final nail in the coffin for private investors in rental properties – tax rates of 24%, 44% and 49% – and a deduction for interest that is restricted to the basic rate will mean that landlords will be looking to sell up and invest their money elsewhere. Tenants looking for good homes to rent will find reduced supply, and thus higher rents due to competition, and will be driven into the arms of corporate build to rent investors.”
Tom Brown
Managing director, real estate
Ingenious
“Your First Home” scheme and the potential support it could provide to first-time buyers at a time when access to homeownership remains a significant challenge for many across the UK. With the cost of delivering new homes remaining stubbornly high, measures that help new buyers take their first step onto the property ladder have the potential to make a meaningful difference across the market. We look forward to unpacking the package of support as more detail emerges and understanding how the scheme will work alongside the wider measures needed to increase supply and support a healthy, sustainable housing market.”
Sarah Bush
Head of residential
Cheffins
“The Your First Home scheme is simply a moderate rebound from the Conservative’s Help to Buy Scheme. Currently, it’s not clear who the biggest winners will be out of this scheme – first time buyers or developers. As the scheme is only applicable to new homes, the Your First Home scheme will not light up the rest of the stagnating property market. Should it have applied to second hand homes too, it might have helped to kickstart chains throughout other brackets, however, I forecast that all this will do is help developers get more new home sales over the line.
“In addition, for the scheme to actually help people onto the property ladder, we need the availability of new homes at affordable levels, which are in short supply throughout much of the country. Without the homes, or the land to build them, or the planning reforms to allow these developments to be built, this looks to just be a vote winning move from the chancellor. The announcement to support the build of council housing only goes so far, we need relaxation of measures for private new build developments for this scheme to make a true impact.
Scott Clay
Director of private clients
Together
“Confirmation of an income cap of £110,000 per household outside of London for the Your First Home scheme means the initiative has more of a shot at being effective, with more aspiring homeowners standing to benefit. That said, there’s still a geographic disparity in the number of potential beneficiaries of ‘the scheme. The income cap may come to bite for those living in the London commuter belt, who miss out on the capital’s £140,000 income cap while having to contend with the higher house prices of the South East.”
Tancrede Fulop
Senior equity analyst
Morningstar
“For investors, this funding shift is unlikely to have a significant impact on the economics of renewable projects. Healey also said the government plans to move older renewable projects onto fixed-price contracts to reduce the link between gas and electricity prices. This reinforces a policy direction first put forward by former chancellor Rachel Reeves. For companies with the greatest exposure, including SSE, RWE and Orsted, the financial impact will depend on the fixed prices ultimately agreed under those contracts.”
Conor Leyden
Managing director
The LK Group
“Removing biodiversity requirements from brownfield sites and ending the constant changes to building regulations will give developers more certainty about what a scheme will cost, which has been one of the biggest barriers to building on previously developed land. Alongside cheaper borrowing for council homes and an extra £1.5bn for social and affordable housing, today’s Budget makes brownfield land a clear priority for new homes.
“Brownfield sites often have complex ground conditions, and contamination, old foundations and unstable ground are among the most common causes of delay and cost overruns. To deliver these homes quickly, ground investigation needs to be carried out early and properly planned, so that problems can be dealt with at the design stage.
Kay Buxton
Chief executive
Marble Arch London BID
“Retail, hospitality and leisure businesses make up over half of Marble Arch BID members, playing a vital role on the high street and in our neighbourhoods. Shops, restaurants, pubs, cafes, hotels, clubs and attractions are the beating heart of Edgware Road and the overall BID area. We therefore welcome the chancellor’s decision to provide business rate relief for small businesses across the retail, leisure and hospitality sectors. Through these measures the government has recognised the structural vulnerabilities and the essential role these businesses play in local economies and high streets.”
Giuseppe Scozzaro
Partner
Goodman Jones
“The Your First Home scheme could be a real boost for first-time buyers who have struggled to save for a deposit, particularly with house prices and the cost of living making home ownership feel increasingly out of reach. Making it easier for people to buy a new-build home could also be good news for developers, giving them more confidence to move ahead with projects that may currently be on hold.
“But the detail really matters, especially when it comes to how much developers will be expected to contribute. We’re already seeing projects struggle to get off the ground because of the combined cost of land, construction, finance and planning requirements. A smaller deposit also doesn’t necessarily make a home affordable, as buyers still need to manage their monthly mortgage payments.
Andrew Lloyd
Managing director
Search Acumen
“John Healey’s maiden Budget has been far from a fiscal firework, instead economic prudence has won out over spectacle. That was perhaps unsurprising given the deliberate decision not to trail announcements ahead of the Budget, but the sheer weight of anticipation from businesses tells its own story: a reminder of just how fragile our economic confidence is, hanging on every word. This lack of foreshadowing also arguably left little space for showpieces and, ultimately, for everyone in property, this reduced room for manoeuvre has been a blessing.
“No mention of a land tax, a wealth tax, no rises in CGT, and further business rates support announced, plus avoiding the disproportionate effect of lowering the thresholds of a mansion tax. Whilst broadly this has set the tone for a do-no-harm fiscal attitude to property tax, landlords will feel an underhand blow from the chancellor today. Raising tax rates on income from property by a further two percentage points from April 2027 is a concern for small and accidental landlords whose margins have already been eroded this year, and we will undoubtedly see this impact in supply and rents over the next year. Conversely, the zero-rate on land sold to social housing providers announced will help incentivise the build and supply of council homes, a much-needed win for the struggling sector.
Sarah Young
Executive director for planning
LUC
“We welcome the government’s commitment to giving local leaders greater powers and resources to drive growth, including new Good Growth funding and £150m to strengthen the capacity and capabilities of strategic authorities. However, funding and devolved powers alone will not deliver the homes, infrastructure and regeneration that communities need. Success will depend on whether local authorities have the expertise and resources to turn investment into well-planned, sustainable development.
“Investment in planning capacity is therefore essential, including the planners, urban designers, landscape architects and environmental specialists who help shape development and ensure economic growth goes hand in hand with environmental protection. Ultimately, the success of devolution will be measured not by the powers transferred or funding announced, but by the quality of the places and communities it helps create.”
Jennifer Lawler
Director of operations
Elite Realty Invest
“Drawing a line under constant changes to building regulations is exactly the kind of certainty investors and developers have been asking for, and investors will be relieved that today’s Budget avoided another round of property tax surprises. However, standing by the rise in tax on property income from April 2027 does little to send the signal that the UK wants their capital, and with growth forecast to slow to 1% next year, more experienced investors are likely to keep spreading their portfolios across international markets.
“That matters for the government’s housing ambitions, because the extra council and affordable homes announced today won’t be enough on their own, and private capital is what gets developments off the ground. That investment has the greatest impact in regional cities with strong employment, regeneration and tenant demand, with ONS figures showing private rents in the North West up 5.7% compared with 3.5% in London. Policy that treats every market the same risks driving investment away from exactly those places.”
Claire Petricca-Riding
Planning & environment partner
Irwin Mitchell
“The most interesting message for the development sector is that government appears increasingly focused on the cost and practical deliverability of development, rather than planning reform in isolation. The targeted BNG exemption for smaller residential brownfield sites and commitment to regulatory stability are clear attempts to reduce cost and complexity for housebuilders. But the wider Budget recognises something equally important: planning permission alone does not deliver development. Grid capacity, infrastructure, public investment and viability increasingly determine whether schemes actually get built.”
Simon Green
Co-head of business rates
Newmark
“Raising the small business rates relief thresholds for the retail, hospitality and leisure sectors, which have remained at £12,000 for almost a decade despite rising rental values, is likely to welcomed by many small businesses in those sectors. It could help more small firms grow without facing a sudden step change in their rates liability, creating a smoother transition as businesses expand and supporting investment at a critical stage of growth. However, businesses operating outside the qualifying sectors may question the decision to limit the support and could argue that similar growth challenges exist across a wider range of industries.”
Tim Sargeant
Chairman
City & Country
“Your First Home gives aspiring homeowners a reason for optimism and the housing market some much-needed momentum. But helping first-time buyers is only half the job. The government must go further to cut the red tape and reduce the tax burden that make building homes increasingly difficult to justify financially. That starts with reviewing the cumulative cost of taxes and regulation. Each new requirement may look manageable on paper, but together they can stop a development before the first brick is laid.
“A more stable policy environment and greater support for small and medium-sized builders would give more businesses the confidence to invest and deliver the homes the country needs. Housing must be treated as essential national infrastructure. If the government matches its support for buyers with a serious effort to make building viable, this announcement could be the start of something much bigger.”
Matt Glazer
Co-founder and director
GLPG
“The industry has long called for a new first-time buyer scheme to kick-start the market, so it’s fantastic to see the government has finally provided a generous offer. The details sound promising. Surprisingly high wage and house price caps should help more aspiring homeowners take their first step onto the ladder, while boosting confidence and investment in housebuilding.
“The scheme would be stronger still if it included existing homes. First-time buyers purchasing these properties help unlock housing chains, allowing others to move and stimulating activity across the wider market. In a stagnant market, that could make a real difference. If the government wants to maximise support for aspiring homeowners and get the whole market moving, it needs to look beyond new builds.”
Sarah Ellis
Director of sales and marketing
Metropolitan Thames Valley Housing
“Raising the income eligibility caps for shared ownership is welcome news and a long-overdue step forward. The caps have remained unchanged for a decade, despite significant changes in house prices, incomes and the wider housing market.
“At MTVH, we have been analysing shared ownership buyer demographics and market data for some time and sharing our insights with G15 colleagues. This has highlighted a growing gap in the market for aspiring buyers who earn too much to qualify for shared ownership but are still unable to afford to buy a home on the open market. These are households who have effectively been caught between two routes to home ownership, with neither option accessible to them.
Brian Welsh
CEO and founder
OPRE Group
“On the wider build-to-rent sector, it is disappointing that the lobbying for the reinstatement of multiple dwellings relief has not been taken into account. BTR is in a paradoxical position: record levels of investment, plenty of capital waiting to enter the market, and yet development starts are collapsing because schemes simply don’t stack up. Given the government’s drive to house the nation, BTR could and should play a major role. A targeted relief for purpose-built rental would have cost the Treasury relatively little and unlocked homes that are currently stalled.”
Kieran Rushe
Planning partner
Rapleys
“The so-called data centre covenant, announced today in the Budget, seeks to do almost the impossible: set in place strict criteria to protect issues such as water supplies being protected in local communities, whilst hoping to deliver critical infrastructure that will get grid connection priority. Whilst the position is understandable and we await the detail, this feels like a ‘keep everyone happy’ measure that will be difficult to realistically oversee and deliver.
“Data centres work differently to other buildings and infrastructure, and communities and, it could be argued, local authorities, do not fully understand their cruciality which is in fact less about AI and technology and more about underpinning the effective workings of everyday business and wider society needs. After all, data centres – albeit in many guises – have been around for decades. They are critical to social, health, education and finance access, not to mention the businesses and economy that they support. Perhaps the government should invest in a better understanding and education of data centres rather than trying to please everyone and putting in place increasingly strict criteria in order to tick the box before delivery.”
Clive Docwra
Managing director
McBains
“This wasn’t a Budget that the industry will get overexcited about, but perhaps contained more than many were expecting. The heavily trailed £1.5bn additional funding for social and affordable housing will give greater certainty to contractors, housing associations, councils and development partners, help unlock mixed-tenure and affordable housing projects and provide a delivery pipeline that is less dependent on private sale absorption.
“Housebuilders will also welcome the commitment that there will be no further building regulations during the current Parliament, unless critical for safety, plus the removal of biodiversity requirements for more brownfield sites was an unexpected bonus that will be applauded.
Tanguy Guerer
Head of pre-construction
Legendre UK
“We welcome the government’s ambition to accelerate brownfield development, but removing biodiversity requirements is not the answer. Biodiversity shouldn’t be seen as a barrier to development, but as an integral part of creating high quality, sustainable places. Exempting more sites from these requirements risks missing opportunities to deliver meaningful environmental improvements through regeneration. Rather than lowering environmental expectations, the government should focus on tackling the inefficiencies that genuinely delay development, from lengthy planning decisions to duplicated submissions and disproportionate conditions.”
Will Matthews
Partner, head of commercial insight
Knight Frank
“Budgets rarely change the economics of property overnight, and this one is no different. But it does give us a clearer sense of the backdrop investors and occupiers are facing. John Healey’s first task today was to reassure bond markets that fiscal discipline remains a priority and, on the face of it, he seems to have done that. There were also some reasons for cautious optimism. The OBR has upgraded its 2026 growth forecast to 1.2%, while recent economic data have held up better than many expected.
“But debt servicing costs remain high and the public finances are tight. There simply isn’t much room for government to spend its way out of the UK’s structural challenges. For property, that means targeted measures rather than a major injection of stimulus: support around business rates, housing and energy, alongside measures on infrastructure, devolution, electricity-network connections and data centres.
Andrew Stanford
Partner in living sector capital markets
Ridge
“The macro-fundamentals underpinning institutional investment in rental housing are still strong. Supply shortages in build-to-rent, for example, have contributed to a steady rental growth of around 3% per year. But the viability of new-build is more challenging than ever. Liability-matching pension fund investors are now favouring UK 10-year gilts, or even commercial debt, over new build living sector investment. At 5.4%, the return on gilts is now nearly half a percentage point higher than what investors can earn on BTR – and without taking on any development risk.
“This challenge has been recognised by the government’s National Housing Bank, but for investment in new builds specifically, today’s Budget does little to lessen it. Investors will most likely focus on refurbishing existing buildings to achieve the returns they need. This could bring more of these buildings into play – but an understanding of what can be adapted, the costs and project timescales, will be crucial to maximising return.”
Ian Pitt
Head of national valuation team
Bruton Knowles
“The small business rate relief for retail, hospitality and leisure (RHL) properties is welcome news. This increased valuation thresholds for RHL properties from £12,000 to £18,000 for 100% relief and from £15,000 to £21,000 for tapered relief from 1 April 2027 combined with permanent reductions for retail, hospitality and leisure sector introduced previously hereditaments with an RV below £500,000, independent hospitality and high street venues will see lower multipliers.
“These lower multipliers for standard high-street and RHL properties continue to be partially offset by higher multipliers applied to the top 1% of valuable commercial properties and large distribution warehouses. This new funding for the hospitality sector will be funded by withdrawing business rate reliefs for sectors considered non-contributory or socially harmful (such as vape shops) and tightening tax and VAT compliance for online marketplace sellers.
“My general view is that it still doesn’t go far enough to support sectors that have been significantly impacted by economic factors which have started before Covid in 2020.”
Nick Diment
Director, head of Boyer London & South East
“The Budget’s significance for the industrial and logistics sector lies in whether it addresses three connected barriers: power availability, infrastructure funding and development-ready sites. Businesses need confidence that suitable premises can become operational within their investment timetable.
:The Strategic Sites Accelerator’s ambition to mobilise around £700 m, including concessional finance where needed, is therefore welcome. Used effectively, this could help bridge the gap between identifying a strategic location and delivering a serviced, investable site. Energy is currently very significant in terms of growth, and the Budget confirms support for eligible manufacturers through the British Industrial Competitiveness Scheme from April 2027, alongside further action on grid delivery and strategic connections, which is welcome.”
Tim Heatley
Co-founder
Capital&Centric
“Every Budget promises new infrastructure. But not many budgets back the buildings we already have and have let rot. Mills, warehouses and landmarks sit empty across the UK while we plan brand new ones. Often the best infrastructure is already standing there, waiting to be put back to work. Littlewoods is the perfect example. It’s a kilometre of art deco that sat unused for decades. With the help of the government’s investment, it will become over 275,000 sq ft of studios, work space and public space, with the potential to bring around 4,000 jobs to the region’s creative sector. Liverpool hosted 301 productions in 2023. Give the industry proper studio space and that number will only increase. The North can compete with anywhere, without every big production having to start in the South East.”
Daniel Austin
CEO
ASK Partners
“Today’s Budget adds further pressure to a property market already struggling with elevated gilt yields, high financing costs and falling valuations. There is capital available to invest, but transactions are becoming increasingly difficult to make commercially viable. The chancellor’s decision to increase taxes on property income and banks risks making an already difficult environment harder. The government has ambitious housebuilding targets, but increasing the tax burden on property investors and potentially adding to the cost of lending will make those targets more challenging to achieve.”
Rob Williams
Partner – real assets
WTS UK
“The UK’s REIT regime has been a real success story for the UK property sector, particularly with relaxations to the regime in 2022 and 2023 resulting in a proliferation of new REITs being established in recent years. It is therefore disappointing to see a further 2% increase in the withholding rate on property income distributions, which reduces the attractiveness of the regime.”
Will Gibby
Real estate research & analytics director
Federated Hermes
“The £1.5bn for social and affordable homes is welcome, and so is the direction on devolution. But this was a Budget for grant funded social housing delivery, and the homes the regions need will not all come that way. There is institutional capital ready to build rented homes in the towns and cities outside London, and consented sites waiting for a decision. What they need is a public contribution to close the viability gap, deployed by combined authorities with the powers to act now rather than in 2028. That was the missing piece today.”
Simon Misiewicz
Founder and chief tax strategist
Optimise Accountants
“Today’s announcement that property income tax rates will rise by an extra two percentage points from April 2027 significantly widens the private rented sector’s ‘phantom profit’ trap. With personal rates set to reach 24%, 44% and 49% in England, higher rates compound existing pressures from Section 24 mortgage restrictions and upcoming digital reporting mandates.
“Landlords cannot afford to treat tax forecasting as an annual afterthought. Instead of waiting for fiscal events like today’s Budget, property owners need to focus on routine fundamentals: stress-testing cash flow against borrowing costs and reviewing portfolio structures. Long-term stability relies on consistent, year-round accounting to avoid discovering a painful cash shortfall when returns are prepared.”
David Barnes
Head of policy and public affairs
Chartered Institute of Building
“This Budget was an opportunity for the government to set out how its ambitions for the built environment will translate into proper action through its devolution and local growth agenda. Devolution must mean more than a transfer of powers or a change in governance. It must give local leaders the resources, long-term certainty, and capacity to deliver tangible improvements, including in housing, infrastructure and construction skills. We look forward to reading the finer details in ‘The Fiscal Devolution Roadmap’ to understand how long-term funding will work.”
Andrew Reynolds
Chief executive
Rider Levett Bucknall UK and Europe
“Against a challenging economic backdrop, the chancellor today outlined his Budget to bring ‘breathing space and fresh hope for the future’, one which needed to provide businesses with confidence and create the conditions for sustainable growth across UK plc. The chancellor’s support for affordable housing, critical infrastructure and regional investment provides some grounds for optimism, but success will ultimately be measured by how quickly these announcements translate into activity.
“The confirmation of funding for the new Your First Home and first time buyer ISA scheme should stimulate demand for new homes. However, demand side intervention must not be hampered by unresolved supply side constraints – resolving planning and infrastructure challenges will be key. Otherwise, there is a risk that greater purchasing power simply meets the same restricted supply.”
Jodie Campbell
Partner and head of residential development sales
Winckworth Sherwood
“The introduction of the Your First Home scheme signals that the government is genuinely trying to stimulate demand in the housing market. Most promising of all has been its willingness to respond to industry feedback by increasing the salary caps it had initially proposed. The introduction of a new first time buyer ISA is also a welcome move to help more people save towards a deposit.
“[However] The measures confirmed by the chancellor today are unlikely to materially shift the dial in terms of unlocking investment and getting more homes built, with the government’s own estimates predicting that Your First Home will support the delivery of only around 20,000 new homes. First time buyers account for a relatively small portion of the new build market, meaning it’s unlikely to give developers and investors the confidence they need to progress with larger schemes.
Robert Poole
Managing director
Glide Property Management part of LRG,
“Building safety must remain a priority, and it is right that the government’s commitment to limit changes to building regulations does not prevent further action following the Grenfell Inquiry. Residents need to know that necessary improvements will continue. But leaseholders also need to know how outstanding work will be funded and completed. This Budget has not announced the additional remediation support we called for.
“Existing programmes, including the Building Safety Fund and the Cladding Safety Scheme, provide important support for eligible cladding remediation. However, they do not provide a solution for every building or every safety defect. Where gaps in eligibility or delays in securing funding prevent necessary work, government needs to provide a clear route forward. Residents deserve certainty about when their building will be made safe.
Andrew Coombs
CEO
Sirius Real Estate
“The detail in today’s Budget on how the government intends to address the £4.7bn defence funding gap provides welcome certainty and a signal of intent on re-industrialisation, even if it is primarily capital reprioritisation rather than new investment. The real test, however, is how quickly Britain’s defence ambitions and capabilities can be translated into operational effect. While the chancellor’s commitment to meeting NATO’s defence spending targets by 2035 is welcome, companies need flexible industrial space now, particularly within established manufacturing clusters, that can be occupied quickly and adapted as their requirements evolve.
Craig Carson
Regional managing director
Barratt London
“The Your First Home equity loan scheme is a positive step towards helping more first-time buyers onto the housing ladder. Our own research shows that 73% of aspiring buyers feel more optimistic about buying their first home following the scheme’s initial announcement, an encouraging early sign of its potential to stimulate demand. The first time buyer ISA is another welcome signal of the government’s determination to get the housing market moving.
“Barratt London remains firmly committed to delivering in the capital, but rising costs and regulatory complexity continue to put pressure on viability. The commitment to no further changes to building regulations this Parliament is a welcome step. The industry has been calling for an end to shifting goalposts – now we have an opportunity to turn that certainty into investment and get more homes built.”
Richard Cook
Head of economics
Pegasus Group
“While today’s Budget contained a number of positive announcements, it remains to be seen whether it provides any sort of long-term boost to our growth prospects. Getting the housing market back on track and the delivery of infrastructure are key ingredients to a thriving economy and we aren’t going to know until next year at the earliest whether the government has got to grips with either of these issues.
“Despite an unforgiving economic environment, measures such as residential brownfield developments on sites up to 1.5 hectares in England being exempt from biodiversity net gain requirements and the updated NPPF are very welcome and show that the government recognises the need to improve the planning system as a way of kickstarting growth.”
Ian Scott
CEO
Ocasa Homes
“Today’s Budget appears to have eased pressure on the bond market, which should provide greater stability for investment yields in the coming period. But it is time the government recognised housing as essential infrastructure. Delivering the homes the UK needs will require a more joined-up approach that connects housing supply, infrastructure investment and economic growth.
“Overall, it feels like the Budget was somewhat of another missed opportunity for housing and the wider built environment. While there is welcome support for social and affordable housing, there is little to address some of the viability challenges holding back development across the UK. In particular, the absence of a UK-wide housing delivery fund may risk another year of minimal new starts.”
Michael Shapiro
Partner
Spencer West
“The headline change for UK businesses is the help needed to protect the high streets we know and love – increasing the business rates threshold from £12,000 to £18,000. As we know that every relief needs a source to pay for it, it was perhaps a shrewd move to align this with taxes on gambling, and carving out adult games centres and vape shops from this relief. Business rates are to be devolved by the end of the decade so that 20% of revenue will remain in the area they are collected. These measures combined might encourage the smaller, independent, and artisan shops back on the high street and return them to thriving hubs of retail, leisure, and community through sustainable and longstanding businesses.”
Adam Daniels
Chief executive
Vistry Group
“We want to build homes and help people onto the housing ladder so are encouraged by the content in the Budget which brings much needed and welcome support for first-time buyers. Likewise, we welcome the additional funding to deliver more affordable homes, especially for councils and registered providers, and the introduction of a new VAT relief on land sold to registered social housing providers to expedite the construction of social housing. However, we would caution that the delivery of the government’s wider housing agenda remains at risk unless the housing development viability challenge is urgently addressed. This must include reducing regulatory burdens, bearing down on construction costs, and backing innovation such as advanced modular manufacturing of new homes.”
Dee Corsi
Chief executive
New West End Company
“There’s a lot to welcome today. The chancellor has rightly described London as an economic powerhouse, and the Government has taken welcome steps to support our high streets. Measures including a real-terms freeze on business rates for all retail, hospitality and leisure businesses, and making online marketplaces collect the VAT they owe, are encouraging. The commitment to greater devolution, with more locally raised funding staying local, is also something we have long called for, and good growth in every postcode starts with places like the West End.”
Julian Broster
COO
Civic
“The Budget signals a clear commitment to accelerating construction and maintaining progress towards net zero by 2025, but it overlooks one of the longest-standing barriers to sustainable development. The continued application of VAT to the refurbishment and reuse of existing buildings, while new build development benefits from a zero-rate, creates a disincentive to retrofit. At a time when embodied carbon is under increasing scrutiny, this remains a missed opportunity. If the government wants to align growth with its net-zero ambitions, it should look again at how the tax system can better support the reuse of existing buildings, while simultaneously supporting delivery across the country.”
Elle Cass
Head of strategic built environment growth at SLR Consulting and chair of the board of trustees for the Royal Town Planning Institute
“Over the past few weeks, I’ve travelled between very different places in the UK. Some are brimming with confidence and momentum – investment is flowing, cranes dominate the skyline and businesses are expanding. Conversely, places often just a few miles away tell a very different story. Employers struggle to recruit the skills they need, young people leave to find work elsewhere and town centres are working hard to reinvent themselves. For all the political debate about growth, the question I kept asking ahead of the Autumn Budget is a simple one: growth for whom?
“Recognising cities and regions as engines of growth, the additional £1.5bn to deliver 10,000 homes in the Social and Affordable Homes Programme – taking total funding to more £40bn over 10 years – alongside increased regeneration funding and greater powers for devolved authorities are welcome signals. The real test is whether investment is aligned behind a long-term vision for place, where housing is connected to jobs and regeneration connected to skills. Too often we announce funding in isolation then wonder why outcomes fall short of ambition.”
Joshua Elash
Founding director
MT Finance
“As predicted, this was a calm, constructive Budget. The headline measures to support home ownership, including the first time buyer ISA and the Your First Home equity scheme, provide first time buyers with a clearer route onto the property ladder. They also offer a welcome boost for developers and give businesses the certainty needed to plan. Together, these measures create a strong foundation for growth in 2027, and specialist finance will have an important role to play in helping the market build on that momentum.”
Penny Simpson
Partner and head of environmental law and the natural capital legal team
Freeths
“While not unexpected, this is a disappointing decision. Brownfield sites can be rich in biodiversity, and exempting further developments from biodiversity net gain requirements risks weakening demand for biodiversity units. That demand is vital if the government wants private investment to support nature recovery. There is a clear tension between today’s announcement and the government’s commitment earlier this week to grow private sector demand for nature. Ministers cannot expect natural capital markets to flourish while simultaneously removing demand drivers.”
Hardeep Kooner
Director
Gateley Built Environment
“More than £1bn of additional investment in the Social and Affordable Homes Programme (SAHP) is a welcome step towards increasing the supply of much-needed affordable housing. However, additional funding alone will not solve the 1.5m new homes challenge. Alongside unlocking planning and regulatory barriers, the focus must now be on turning that investment into deliverable schemes, particularly given the scale and complexity of the development pipelines that registered providers and developers will be managing over the coming years.
“Long-term funding certainty gives the sector an important opportunity to plan ahead, but successful delivery will depend on having the right capacity and expertise in place throughout the development process. Ensuring schemes remain viable, managing risk effectively and maintaining quality will be critical if this additional investment is to translate into homes on the ground.”
Terry Woodley
MD of development finance
Shawbrook
“While protecting the environment is a key consideration, our recent research revealed that 63% viewed biodiversity net gain (BNG) requirements as a significant barrier to development. As such, today’s announcement that biodiversity rules will be relaxed will be well received by developers. Whilst still encouraging developers to consider the natural environment and how they can enhance the sites they’re developing, this bodes well for the future of the sector and makes developing brown belt land a win-win. For property developers it supports housebuilding and for local communities it makes use of land that’s often overlooked or ignored and can provide valuable housing or retail spaces.”
Fraser Carr
Group sales and marketing director
Cala Homes
“Your First Home has the potential to make a real difference to first time buyers in England, particularly those who are working hard to save for a deposit while also managing rent, household bills and the wider cost of living. For many people hoping to get onto the property ladder, finding enough money for a deposit remains one of the biggest challenges. By reducing the minimum deposit requirement to 2.5%, alongside a 20% government-backed equity loan, the scheme could help more people take that first step towards homeownership, without having to rely on financial support from family.
Kirsty Harrower
Partner
Norton Rose Fulbright
“The data centre covenant could help unlock strategically important projects in the UK by accelerating access to grid capacity and the planning process. However, it should be noted, according to the covenant this support will come with greater expectations around energy and water use, community benefits and security. The key question for developers and project owners will be how the government defines which projects qualify as ‘strategic’.”
James Shorthouse
Head of specialist markets
Colliers
“There is plenty for hospitality to welcome here, particularly support for smaller businesses and measures that leave consumers with more money in their pockets. But the big missed opportunity is National Insurance. The failure to reverse the NI threshold changes means one of the most damaging cost pressures on hospitality businesses remains firmly in place. With high wage bills, fragile consumer confidence and the prospect of an overnight visitor levy also weighing on the sector, there is still more to do to create the conditions for businesses to invest and grow.”
Simon Peacock
Head of regions
JLL
“The test following today’s Budget is whether regional leaders have the funding, flexibility and certainty to turn growth ambitions into development. For investors and developers, the practical questions remain straightforward: will transport improvements unlock sites, will energy infrastructure support new employment space, and will funding help bring forward housing and regeneration schemes that currently struggle to stack up?
“The detail of fiscal devolution will be critical. Investors need clarity on when powers become available, how funding will work and how local and national delivery bodies will work together. That will determine whether commitments translate into projects. Greater local control offers an opportunity to connect decisions on housing, transport, skills and employment space. Success now depends on giving places the resources and delivery capacity to make those decisions count.”
Richard Steer
Chair
Gleeds Worldwide
“This was very much a ‘Ming vase’ Budget, with the chancellor appearing determined not to unsettle markets, voters or Labour backbenchers. Against that backdrop, expectations across the built environment were modest and, regrettably, those expectations proved well founded. Fiscal discipline may constrain the chancellor’s room for manoeuvre, but stability alone will not deliver growth.
“Construction and the wider built environment needed a clear signal that government remains committed to investment, delivery and creating the conditions businesses need to build with confidence. Beyond measures to ease certain regulatory burdens, there was little aimed directly at stimulating housing delivery, despite ongoing pressures from rising costs, viability challenges and uncertain market demand.”
Jonathan Layzell
Chief executive
Stonewater
“The announcements in today’s Budget will be welcome news for many of our customers – much-needed support on energy bills and wider cost of living measures will ease some of the burden faced by households across the country. It has been a significant year for the social housing sector, and we were delighted to reinforce our position as a key strategic partner for Homes England after being allocated £350m under the Social and Affordable Homes Programme. The confirmation of an additional £1.5bn into the programme is a crucial signal that the government recognises the appetite from the sector to deliver more in partnership with ambitious local authorities.”
John Scully
Director
Sixteen Real Estate
“Despite the chancellor’s welcome introduction of targeted business rates relief to eligible retail, hospitality and leisure businesses, little has been done to address the astronomical costs facing the industrial occupiers that keep those businesses stocked. You cannot protect the shopfront while ignoring the warehouses behind it. Ruling out an additional warehouse tax is welcome, but it does not resolve the wider business-rates issue. Properties with rateable values of £500,000 or more still face the higher value multiplier. For larger industrial and distribution occupiers, that adds to the cost of occupying the space they need to operate and grow.”
Peter Allinson
Chief executive
Davitt Jones Bould
“The chancellor’s decision to ‘play safe’, particularly in the wake of the disastrous Truss/Kwarteng mini-Budget of three years ago, is understandable, but it missed a crucial opportunity to get the housing market moving again. Scrapping SDLT would enable many more people – particularly among the young – to spend their hard-earned funds on buying a home. Doing away with what is effectively a penalising tax for those looking to buy a property would increase the rate at which people move – it was every seven years in the 1980s but is now more like 20-plus years – and put more money into the wider UK economy. It’s hugely regrettable that Mr Healey didn’t take this bold and necessary step.”
Chris Gardner
CEO
Atelier
“In an ideal world, the market wouldn’t need a boost, first time buyers wouldn’t be facing affordability challenges, and developers wouldn’t be reckoning with stagnant demand as well as supply-side restrictions. But in the current market the economy has become a series of trade-offs. The choice is either to stand still and let matters worsen or to take action and try and move the dial for first-time buyers. Even if ‘Your First Home’ is even a modest success, this will be a significant aid to economic growth and importantly help young people escape the rental trap.
John Wilkinson
Chief operating officer
BAM UK & Ireland
“Infrastructure is what turns economic ambition into tangible growth that people can see. It connects people to jobs, helps businesses grow and creates the schools, hospitals, transport links and energy networks that communities depend on in day-to-day life. The UK has an infrastructure pipeline worth £718bn, representing an enormous opportunity for economic growth. Funding announcements must be matched by clear delivery plans. A reliable pipeline gives businesses the confidence to recruit, train and invest, turning national ambitions into jobs and opportunities across the country.
Luke Longley
Director – rating
SHW
“The increase in [the small business rates relief] threshold is long overdue. It’s a shame this is just limited to RHL [retail, hospitality and leisure] businesses. It also adds an additional layer of complexity to the system. It will now be even more important that businesses are correctly listed as being RHL. It is often the case the local authorities miss some businesses who trade from ‘non-standard’ RHL properties, for example a gym operating from an old workshop.”
Brian De’ath
Managing director – sales & marketing
Ballymore
“We welcome the government’s commitment to helping more first-time buyers onto London’s housing ladder, and the setting of an income cap at £140,000 is a positive step. However, the detail will be crucial to making the scheme work, and we are concerned that the proposed price caps do not fully reflect the realities of the capital’s housing market.
“A couple with a combined income of £140,000 could afford a home worth around £750,000 through the scheme, yet they’ll be capped at £650,000 in inner London and just £500,000 in outer London, less than Help to Buy allowed a decade ago. This could have unintended consequences, favouring certain postcodes and creating an artificial divide across the capital, where buyers on one street face a lower price cap than those just around the corner, simply because they fall on different sides of the borough boundary.”
