Future Public Spending Trends Chancellor announced in his last Budget that the UK public borrowing requirement in 2009 and next year will be £175Bn per annum. Someone will have to pay this back and UK government intends to start doing so in 2011. The last Conservative Government immediately reduced the Housing Budget spend by 68% Devolved and Local Government Funding will have to reduce as well, e.g. Revenue Funding – by up to 15% Capital investment – by up to 50%
AHIP PrivateWho helps or sells to these people ??
Whats going to change? Far greater use of Shared Equity, Mid Market Rental and Private Rental Investment in delivering Affordable Housing To be a permanent change it will need important procedure changes to Stamp Duty, Residential Investment Taxation terms and VAT by HMRC Large scale Private Rental Investment Vehicles are beginning now – AVIVA were the first to set one up! Private Developers and RSLs will need to work collaboratively to respond to this change.
Developers have had to evolve:- New models of Mortgage created (i.e. shared, underwritten or longer) Valuation or Buy-back guarantees Greater variety in house types Bespoke ordering Private rental investment vehicles Partnership working models with HAs/Councils Land Values will stabilise, but at least half of the Q3 2007 levels Infrastructure costs have become hyper critical Easier, cheaper sites are the first priority Demand is beginning to return, lets be ready for it!!!
Output Growth aspirations remain unchanged! Realism over effective land What types of land and sizes of site are still deliverable? What are barriers preventing delivery? Realism over need for product mix Mix of sizes/types/specs? Genuine partnership (public & private sector) needed Common causes - How do we meet high Infrastructure funding demands? - Must avoid further regulation creep! - Creating effective Development Consortia....... - Securing three year development funding programmes? Joint Strategic Considerations