Published on : Tuesday, December 10, 2013
The property industry welcomed the Chancellor’s announcements on business rates, planning reform and changes to the REIT regime, but sounded a note of caution on plans to hike taxes for overseas investors.
Responding to the Autumn Statement, Liz Peace, Chief Executive of the British Property Federation, said: “Operating within his self-imposed constraints, this was on the whole as good as we could have expected from the Chancellor. On the business rates cap, planning reform and changes to the REIT regime we can feel pleased that George Osborne has listened to the property sector.
Responding in detail to policy announcements, Liz Peace said:
Business rates reform– “We are delighted that the Chancellor appears to have heeded our calls – and those other business groups – of to commit to a review of business rates, as well as taking short-term action to mitigate the harm that continues to be caused by this archaic property tax. However, simply tinkering around the edges of the system will not be enough – the business rates regime remains one of the greatest barriers to investment in the built environment, and is fundamentally unfit for the 21st century.
“Action to support the re-use of empty shops is particularly welcome. Empty properties blight our high streets and town centres, and we would urge government to think further about reforms to the business rates regime that would allow property owners to invest further in these properties.”
Reits as institutional investors – “We are very pleased that the government has decided to support our request to include REITs in the definition of institutional investors. We believe that this will increase the attractiveness of UK investment property by making it easier for REITs to raise funds through joint ventures and co-investment arrangements. By allowing overseas REITs to take significant interests in UK REITs, the decision will ultimately increase the availability of capital to the UK market and at the same time promote the transfer of expertise, with widespread benefits for the whole industry.”
Action to unlock stalled housing sites – “The £1billion 6 year programme to fund infrastructure to unlock housing sites is very welcome. The up-front cost of infrastructure is one of the biggest deterrents to development. In many cases, a comparatively small amount of Government funding can transform the viability of major housing projects.”
New energy efficiency grants for homebuyers and private landlords – “In terms of the incentives as they are described, based on the amount of funding and the homes being targeted, each property would receive £2000 of Government funding. We would, however, urge the Government to ensure that the level of finance available is sufficient to provide adequate funding for the measures necessary to bring the least energy efficient rental properties in line to meet the Government’s minimum energy efficiency standards under the Energy Act 2011.”
Tags: Autumn Statement, Chief Executive of the British Property Federation, Energy Act 2011, George Osborne, government funding, property industry, UK REITs
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