Autumn Budget 2017: Weak UK Economy growth risks jeopardising the positive measures on housebuilding
This article is by TTF Managing Director David Hopkins in response to the Chancellor’s 2017 Autumn Statement (22 November 2017)
The measures announced by the Chancellor yesterday to boost housebuilding will be welcome news to the timber supply chain, and to the rest of the construction sector.
The extra £1.5billion to help small developers, along with the SME housebuilding fund, will help local merchants and builders, while the powers for councils to charge higher council tax rates on empty properties will help boost RMI work for smaller builders as those buildings go back into occupation.
Meanwhile the target of 300,000 net new homes per year by mid-2020s is something achievable through the timber frame sector which has seen huge growth in factory capacity investment in recent years. Timber construction has particular advantage in the high density urban areas the Chancellor is targeting in this Budget.
However, overall, these measures were dampened by the news that the UK economy is now far weaker than the Government thought in March, and has growth forecasts of just 1.3 – 1.6% per year, well below its long-term average, well into the next decade. This is partly due to weak productivity and partly the damage from the Brexit situation.
Until these issues are resolved, the good news from other aspects of the Budget will be unlikely to be felt by many.