Autumn Statement 2023

Jeremy Hunt, the Chancellor recently announced the Government’s latest Autumn Statement by outlining plans for the year ahead and included key measures designed to “help grow the economy.”

Amongst the announcements, was some positive news for landlords, tenants and the property market in general.

As well as tax cuts for the self-employed, an increased benefit threshold for lower-income tenants, and planning incentives to encourage property development, the following announcements were also made:-

Local Housing Allowance Threshold Increase

Local Housing Allowance has been extended to cover 30% of local market rents, with the Government predicting around 1.6 million households receiving an average of £800 in support next year.

This allowance is used to calculate the maximum amount private renters can claim in Universal Credit or Housing Benefits. The exact claimable figure varies according to location, number of bedrooms, and rental amount.

Since 2020, Local Housing Allowance has been frozen, this is despite the fact that rents have been rising sharply. It has therefore, been introduced with the aim of addressing the issue of rental property affordability.

National Insurance tax cuts for the self-employed

National insurance tax cuts will be introduced for self-employed people. This is to include abolishing Class 2 National Insurance for those who earn in excess of £12,570 a year. The change will typically affect approximately 2 million self-employed people in the UK – including property landlords.

Self-employed people in this bracket will no longer be required to pay a compulsory charge of £3.45 per week, thus saving them around £192 per year. The Government also announced a 1% cut on Class 4 National Insurance for the self-employed, decreasing the rate from 9% to 8% on all earnings.

Planning System Performance Reforms

A premium planning service will be launched across England, with guaranteed accelerated decision dates for major applications and fee refunds wherever these are not met. This also includes measures to improve transparency and reporting of planning authorities’ records in delivering decision-making that is efficient and timely.

Permitted Development Rights to Convert Houses into Flats

The Government will begin consultation on new Permitted Development Rights, enabling any home to be converted into two flats provided “the exterior remains unaffected”. The consultation is to be implemented in 2024.

Increase to National Living Wage

The National Living Wage will be increased by almost 10% – up from £10.42 to £11.44 per hour. This is the minimum hourly pay workers receive, which has now been expanded to include anyone aged 21 years and above. It is estimated that more approximately over 2.7 million workers will benefit from this increase.

Mortgage Guarantee Scheme Extension
The scheme, which supports the availability of 95% Loan-to-Value Mortgages, will be extended for an extra 18 months until the end of June 2025. The aim of this is to enable borrowers with smaller deposits to buy a home.

Local Nutrient Mitigation Fund
The Government is providing £110 million of funding to support Local Planning Authorities to deliver high-quality schemes to offset nutrient pollution, which should unlock otherwise-stalled planning permissions.

Affordable Homes Guarantee Scheme
The Government is expanding this scheme by an additional £3 billion to support housing associations to access cheaper loans for quality and energy efficiency works in addition to new homes.

Housing Revenue Account Rate extension
This policy margin announced in Spring 2023 supports local authorities borrowing for Housing Revenue Accounts and could provide savings and additional investment in Social Housing.

Home Buying and Selling Improvement
The Government is allocating £3 million for measures to improve the process of home buying and selling. This includes pilot projects for developing property tech products and digitising local council property data.

Local Authority Housing Fund
A fund of £450 million was announced for local authority housing, with a third of this amount aimed at delivering 2400 new housing units to house Afghan refugees and thereby easing wider housing and the pressures of rough sleeping and homelessness.

For any enquiries or advice about letting or selling your property, please call your local David Andrew Office today: - Archway: 020-7619-3750, Highbury: 020-7354-9111, Stroud Green: 020-7281-2000, email info@davidandrew.co.uk