Hunt forgets property market in Budget 2023 - specialist finance industry reacts

Chancellor of the exchequer Jeremy Hunt delivered his Spring Budget in the House of Commons earlier today (15th March) to map out how he will improve economic growth in the UK.

Hunt announced a £27bn tax cut for businesses, 30 hours free childcare for children over the age of nine months, and a trio of freezes to help families with the cost-of-living.

The £27bn tax cut for business will include a ‘full expensing’ policy which will be introduced for the next three years to boost business investment, in an effective cut to corporation tax of £9bn per year.

The independent Office for Budget Responsibility (OBR) forecast this will increase business investment by 3% for every year it is in place.

Hunt signalled an intention to make this scheme - which covers equipment for factories, computers and other machinery - permanent when responsible to do so.

The chancellor revealed a comprehensive plan – dubbed the ‘four E’s - to help people move into work, increase their hours, and extend their working lives, including for those on benefits.

For example, the Annual Allowance will a rise from £40,000 to £60,000, in a bid to incentivise highly skilled workers to remain in the labour market.

In addition, a new ‘Returnerships’ apprenticeship targeted at the over 50s will refine existing skills programmes to make them more accessible to older workers, giving them the skills and support they need to get back into work.

Measures announced by Hunt to ease the cost-of-living burden are expected to help more than halve inflation, with the extension of the Energy Price Guarantee and duties on fuel and a pub pint both frozen.

Hunt also unveiled a series of reforms to support people into work, removing barriers that stop those on benefits, older workers, and those with health conditions who want to work from working.

“Our plan is working – inflation falling, debt down and a growing economy,” said Hunt.

“Britain is on a lasting path to growth with a revolution in childcare support, the biggest ever employment package and the best investment incentives in Europe.”

However, it was radio silence when it came to supporting the property market.

Property and specialist finance market responds to the Budget 2023

This section will be updated throughout the day — check regularly for more comments from industry experts


Trevor Morriss, principal at architecture studio SPPARC: “The government’s new investment zones will provide a welcome boost to key regional cities. However, the inauspicious absence of planning reform creates a ceiling on the policy’s impact.

"Architects and developers are constantly endeavouring to respond to commercial demand, but are held back as schemes languish in the planning system. Too often growing industries in the UK lose momentum as innovation is inhibited by a lack of affordable housing, offices and life science space.  

"We need a joined-up approach, which connects the dots between investment and the physical capacity of cities.”

David Alcock, MD at Blend: "Today’s Spring Budget was expected to focus on the government’s plans to boost economic growth, but frankly, this is entwined with the housing market and there cannot be sustainable economic growth if first the housing market is not fixed.

"Many parts of the country, including London and the South East are just unaffordable for most people.

"In the past, the government’s answer to the housing crisis has been throwing demand at the problem; we have seen successive governments trying to (unsuccessfully) tackle the housing issue by coming up with measures to support demand, but that sadly left the supply of housing struggling to keep up.

"I was looking forward to a larger focus on supply-side measures and support for SME property developers in today’s budget, but unfortunately, that wasn’t to be, and today’s budget yet again missed the opportunity to tackle the UK’s deep-running housing crisis."


Giles Mackay, founder of Outra: "The chancellor has produced a welcome budget focused on growth and future economic prosperity, but there is an elephant in the room – housing. We have an ongoing state of affairs where young people without the Bank of Mum and Dad are unlikely to ever be able to afford their own home, and that needs to be addressed. 

"Promoting affordable ownership through vehicles such as shared ownership or even having simply extended Help to Buy by a couple of years would have helped our younger generations have a realistic chance of homeownership.

"Crucially, it would also have helped encouraged housebuilders to keep building, as these firms will down tools and cut building programs back if they can’t sell their inventory. Building homes and getting people onto the housing ladder is of great benefit to the overall economy’s prosperity."

Lawrence Turner, director at Boyer:

"The chancellor opened his budget by saying that it was one of ‘removing obstacles’. But unfortunately it will do little to resolve the most significant issue to affect housing development up and down the country – that of nutrient neutrality.

"Two months ago, I was invited to No.10 to discuss nutrient neutrality and unlocking housing delivery, for what seemed to be a very constructive meeting. Since then, much of the debate has focussed on what water companies can do to solve the issue at the source, with the government introducing a new legal duty on water companies (via the Levelling Up and Regeneration Bill) to upgrade their wastewater treatment works by 2030. The problem is that this is not a quick fix and does not unblock housing development today.

"There has also been discussion on how local planning authorities (LPAs) have taken an extremely cautious interpretation of the Habitat Regulations – which prevent planning permission being issued for new residential development unless the applicant can solve a nutrient problem that they aren’t responsible for and that costs a huge amount of money for a developer to mitigate. Money that will usually be directed away from building much needed affordable homes on development sites."

William Scoular, head of private client lending at Investec Real Estate

“Despite calls from the wider industry getting increasingly loud, it’s disappointing that another budget announcement has come and gone without the government addressing the highly punitive VAT policy that discourages retrofitting residential property over building new developments.

“The government’s net zero ambitions will not be met without existing real estate being modernised and this is unlikely to happen at the required volume while these financial barriers remain in place.

“Repurposing is already often more expensive than new developments, so the government should be trying to alleviate those costs and make it more attractive, given the environmental benefits of the carbon savings associated with these projects.”

Tomer Aboody, director at MT Finance:

“The housing market has settled down after the fallout of the mini-Budget and thankfully there doesn’t seem to be anything in this Budget to upset the apple cart.

“There are fewer transactions as rising interest rates and the cost of living mean affordability is more of an issue, but the real concern around transactions is that they are taking so long. It would have been good to see some reform of stamp duty, particularly for downsizers, to encourage more transactions, but the chancellor has chosen not to intervene at this stage.

“The OBR forecast for inflation at 2.9% by the end of the year is extremely welcome and will have a further settling effect on the market should this prove to be accurate. It already looks as though interest rates may have peaked or are close to doing so, and inflation falling so decisively will help with that.

“With sentiment better on the economic side than it has been in recent months, this Budget should be a welcome boost for confidence.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman:

“We wanted to see more from the chancellor, particularly with regard to increasing supply of new homes to keep prices in check, as well as increased support to encourage new landlords and discourage others from leaving the sector.

“In some ways, it could be seen as a positive Budget in that the chancellor left the housing sector well alone. Housing makes such a significant contribution to economic prosperity due to its multiplier effect, so is sensitive to even small changes. 

“More specifically, the housing market is all about confidence and sometimes you can do more damage by tinkering, so we will give him a B-plus for effort and not doing anything which could have been harmful and compromised activity.”


Jonathan Hale, head of ESG consulting at Knight Frank

“It is disappointing that today’s Budget lacked more meaningful measures to support business addressing the urgent needs of the planet. Real estate companies are leading the charge in addressing the sector’s contribution to climate change, but need the government to mitigate the associated risks and create more opportunities for positive impact. The chancellor missed the opportunity today, for example, to introduce tax incentives for reducing embodied carbon in retrofit and refurbishment projects.”


Israel Moskovitz, cofounder of Avon Group of Properties:

“We were hopeful that in today’s Budget, Hunt would announce relief for businesses and househunters, especially given the challenges faced by many as a result of the cost of living crisis and inflation.

“Househunters specifically will have been looking for more support from this Budget. The end of the Help to Buy scheme is looming and will be significant for many first-time buyers.

“Today, we were hoping for more support to be announced in its place, and the government will need to do more to offer some relief to those looking to move up or around the market.”

James Dickens, managing director at Wavensmere Homes:

“With mandatory housing targets scrapped, there is a significant reduction in the number of affordable homes coming onto the market. Above-inflation rises in the cost of raw materials, and additional new costs facing housebuilders for environmental mitigation – which would be more appropriately directed at those using fertilisers – are also negatively affecting the supply of lower-cost new homes.

“With the recent conclusion of Help to Buy, the only help first time buyers have is the current Stamp Duty exemption for homes valued up to £425,000. But with less homes being built, there has been a marked impact on the rental market.

“For every home available to rent, there can be as many as seven people vying to occupy it. It is no surprise we have therefore seen rent hikes of 24% for soon to be completed homes at our Belgrave Village scheme in central Birmingham, and similar increases of 22% at Nightingale Quarter in Derby City Centre, where the final phases of the £165m scheme are being matched with buyers.

“With the continued rise in the cost of living, hardworking people are more trapped than ever as renters, because mortgage deposit payments are so hard to save for.

“While no one expected the Chancellor to announce a silver bullet, the fragility of the UK’s economy has not been sufficiently boosted by today’s Budget.”    

Paul Sams, partner and head of property at Dutton Gregory Solicitors:

“We predicted that this would not be a Spring Budget to remember, it was a positive move to introduce the price cap on energy bills, the introduction of the childcare reforms, and reassurance that inflation will decrease by over half to 2.9%, however there were some missed opportunities, particularly for the property industry.

“There were a number of simple initiatives that could have had a transformative impact on the UK’s property sector, with every new transaction pumping circa £10,000 into the wider economy.  This should have included a Help to Buy Scheme that would have actively increased the number of first-time buyers, and incentives and support for landlords to make the investment into retrofitting eco-friendly technologies into their BTL properties.

“If we want to see the UK’s homes become far more energy efficient, landlords need to be incentivised to make the investment into retrofitting eco-friendly technologies into their BTL properties. There are some grants available, but the uptake is very low because of the complexity and red tape.

“A largescale residential property upgrade scheme could be rolled out, mirroring the simplicity of the 2020 furlough system. By seizing the opportunity to see millions of homes upgraded to an EPC-C performance, the chancellor could deliver a very welcome shot in the arm to the property, construction, and manufacturing sectors, while also reducing the energy bills and carbon footprint of renters.”  


Lionel Benjamin, co-founder of AGO Hotels:

“With the continuing economic struggles facing SMEs, businesses were looking at today’s Budget to provide a lifeline. It fell short.

“It was disappointing that the chancellor did not reverse next month’s corporation tax rise. With double-digit inflation and rising bills, this means further costs for businesses which we are trying not to pass onto the consumer, but it is becoming more difficult not to do so and, in the coming months, we may see more businesses close their doors.

“Hunt did make announcements aimed at boosting the economy, including 12 new investment zones, regeneration projects in key town centres, and business rate retention, giving local authorities more control on spending. However, the devil will be in the detail, and we believe that specific incentives are needed around the regeneration of city centre buildings, particularly those which are closed, to be converted into hotels.

“At AGO Hotels we are calling for a reduction of output VAT to 10%, widening the scope of capital allowances offered to encourage development and ESG investments, and a comprehensive review and reduction of the widely outdated system of business rates. For the hospitality sector to thrive and survive, we need more.”

Ravi Anand, managing director at ThinCats:

I think it’s important to remember that if we are going to grow the economy, it will largely be done by facilitating private investment, improving the UK’s woeful productivity levels, and embracing a culture of entrepreneurialism.

“Measures like extending the energy price guarantee and fuel duty cut will be welcome by business, albeit an overall increase in corporation tax does not send out a positive message. Budgets, by their nature are political affairs, so the chancellor will almost certainly have his eye on an election.

“For SMEs, and specifically mid-sized businesses who we lend to, we are seeing strong demand for capital, especially in service and B2B sectors, where they are looking to expand or acquire other businesses.

“Anecdotally, we are hearing that some high-street banks are reducing their credit appetite, which allows non-banks like ourselves to support wider M&A or MBO activity.

“One thing that’s important to note is that as these businesses operate in the service sector, they are typically ‘asset light’ so, in reality, the super deduction or wider capital allowances to invest in their businesses largely don’t apply.

“It’s right that we think about wider competitiveness and investing in zero carbon technology, but a lot of this is irrelevant to most UK domestic businesses.”

How will you be affected by today’s Budget announcement? Share your opinions by emailing [email protected].

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