In his final Budget before the UK leaves the European Union, did Chancellor Philip Hammond allude to a significant boost for the rising number of Britons demanding residential property in prime town and city centre locations?
- UK towns and city centres are set to be given a £675 million renovation boost, under plans announced in the Budget 2018
- The UK government also outlined a consultation phase on loosening planning regulations, which would enable 50,000 empty shops to be converted into residential homes
- With growing numbers of British tenants choosing to live in central locations, could these proposals further drive the demand for new city centre homes?
Did the UK government just announce a huge boost for tenants and investors of city centre real estate?
On Monday 29th October, Chancellor of the Exchequer Philip Hammond presented his Budget 2018 speech to ministers in Westminster, outlining the final review of Britain’s economy, in addition to plans for future fiscal policy, before the country leaves the European Union in 2019.
Headlines extensively covered the key top-level summary from Mr Hammond, namely that spending on public services will increase and income tax for many UK workers will be cut.
But there was a pledge, outlined on page 46 of his full Budget document, that should grab the attention of UK property investors, tenants and homeowners alike.
Mr Hammond announced a new ‘high street taskforce’, aimed to help rejuvenate economic growth in many UK town and city centres. Armed with a £675 million windfall, the plans will improve transport links, as well as refurbishing local historical buildings.
Yet that could be just the start. The Chancellor also revealed that the government will consult on relaxing planning rules, enabling some of the UK’s 50,000 empty town and city centre shops to be transformed into residential homes.
The planning reform consultation document outlined: “We propose a new permitted development right to extend certain existing buildings upwards to provide additional, well designed, new homes to meet local housing need. National planning policy is clear…we should make effective use of previously developed land and buildings, including the airspace above existing buildings, to create new homes.”
It comes at a time when the UK’s town and city centres have established themselves as the most desirable places to live in the country, thanks largely to demand from young workers.
Since 2000, the population of many town and city centres in the UK has doubled in size. Between 2002 and 2015, there was a 181% increase in the number of people living in Liverpool city centre, 163% in Birmingham and 149% in Manchester.
Demand for city homes means many tenants are prepared to pay a premium to access these homes, helping to grow returns for owners and property investors.
This newly-announced consultation underlines the importance placed on city centre property markets by the UK government.