BUDGET 2024: Key takeaways for real estate

In his final budget before the general election, chancellor Jeremy Hunt disappointed the property sector with no mention of business rate reform for the UK’s high streets. In a heavily trailed budget, perhaps the only surprises for the property sector were the announcement that Canary Wharf would be the recipient of Levelling Up funding and that Surrey would enjoy a devolution boost. EG looks at these and other key takeaways for real estate. Notable omissions from Hunt’s speech also included tax-free shopping for tourists. Levelling up cash for Canary Wharf Hunt announced £242m of Levelling Up funding for Barking Riverside and Canary Wharf. “Together [this] will build nearly 8,000 houses as well as transforming Canary Wharf into a new hub for life science companies,” the chancellor said. Barking Riverside will receive £124m, while Canary Wharf will receive £118m to accelerate delivery of a life sciences hub, commercial and retail floor space, a healthcare diagnostic facility and up to 750 homes. Barking Riverside is a 10,800-home brownfield regeneration, with 5,400 homes left to build. Half are designated as affordable. L&Q is delivering the new Thameside town in partnership with the mayor of London and Barking Riverside Ltd. Elsewhere in London, Hunt confirmed plans to establish the Euston Housing Delivery Group, with £4m allocated to support proposals for up to 10,000 new homes in the area. Hunt said the government has additionally allocated £188m for projects in Liverpool, Sheffield and Blackpool. He also announced a £20m community-led housing scheme to support local communities “to deliver the developments they want and need”.  More devolution to local leaders Hunt announced the “North East trailblazer devolution deal”, saying this would provide a package of support which could be worth more than £100m. The chancellor said there would also be more devolution of power to local leaders in Buckinghamshire, Warwickshire and Surrey, who are “best placed to promote growth”. Eyes on tech investment Hunt said he was looking at further measures to stimulate the tech sector by encouraging tech entrepreneurs “to start here and stay here” at stock market flotation. This includes building further on reforms to make it easier for pension funds to invest in the UK. Support for creative industries The chancellor confirmed the Autumn Statement announcement that the rate of tax credit available to the film industry will rise by 5% and an 80% cap for visual effects costs will be removed. Stimulating investment into life sciences Hunt announced a new £650m investment by AstraZeneca into the Cambridge Biomedical Campus and into a new vaccine manufacturing hub in Speke, Liverpool, which he said had been encouraged by government incentives. In addition, £10.2m will be invested to support the development of the Cambridge Biomedical Campus. This is split into £7.2m to unlock improvements to local transport connections for the Cambridge Biomedical Campus and the city, and £3m for Cambridge University NHS Trust to support plans for growth. Hunt confirmed that a development corporation in Cambridge will be set up, and that it will receive a long-term funding settlement at the next Spending Review to support the delivery of new homes and lab space.  Reducing higher rate of property capital gains tax The higher rate of property capital gains tax will be reduced from 28% to 24%. Hunt said the reduction would increase revenues by leading to an increase in the volume of transactions. Reducing scope of non-dom tax relief Hunt said that, after extensive review, the current system of tax breaks for wealthy foreign residents in the UK who have non-domiciled tax status would be scrapped from April 2025. It will be replaced with a “modern residency system”. Ending stamp duty relief for multiple dwellings Hunt said this tax break had been intended to support investment into the private rented sector but was being regularly abused. It will be abolished. Changes to empty property rates relief Beyond Hunt’s speech, the Red Book details a decision to extend the reset period for empty property relief in England to 13 weeks, from six weeks. The changes will take effect on 1 April. The government will also consult on a general anti-avoidance rule for business rates in England. Image © James Veysey/Shutterstock