While the uncertain impact of volatile market conditions, and of course Brexit, remain to be seen, businesses of all sizes are having to adapt to become more flexible than ever before. Even the most well-established businesses with enough capital to sustain sudden expenses, are reviewing what were previously assured and predictable growth plans. Philip Sugden, Operations Director at Portal Group UK, explains more for Finance Monthly below.

A business’s property profile is one of the most costly financial investments to be made and over the years the associated fixed rental rates are amongst the standard steps taken in establishing a solid presence for your business.

That cost certainty however, came at a price of the flexibility that is now critical in the modern and reactionary market place.

New businesses are growing at an entirely unpredictable rate while some large established businesses are seeking the autonomy to customize a workspace to better respond to supply and demand. However, with office space at a premium, both large and SME businesses are finding it harder to find a premises that can fill their present and future without breaking the bank.

The possibility that you might need to expand, reduce, reallocate or relocate your workforce at the speed required, particularly for example in the contact centre environment, is extremely costly and entirely impractical under the traditional office lease.

Whether a business is expanding or simply relocating due to success or commercial needs, budgets can no longer be front-loaded into capital expenditure laden construction or leasing of properties.

When considering the growing need to balance financial flexibility with cost certainty in the UK, it’s also interesting to note that our leasing habits differ vastly from the norm abroad. For example, while companies here have traditionally committed to the surety of long 10, 15 or even 20 year leases, the average is closer to three years in the US or India.

While these short-term lets would be at odds with the business growth plans of most UK businesses, more and more businesses of all sizes are increasingly exploring more flexible yet capex-free models.

The likes of managed office solutions (MOS) financial packages, which combine property acquisition, workspace design, fit out, facilities management and supporting services, reflect the emphasis now being placed on financial flexibility and the more expansive use of fluid operating costs (opex).

With simple, streamlined systems and structured terms, business owners can invest their time, effort and money into their businesses, not bricks and mortar.

Simply put, the new wave of shared offices options are allowing start-ups and multinational businesses alike to not only access all the amenities they need at a cost-certain price, but to work within a flexible financial model that fosters their own unique growth and culture.

In this guide, experts at ABC Finance help Finance Monthly break down what commercial mortgages are, how they work, how the application process works and how much you’re likely to pay.

What is a commercial mortgage?

Commercial mortgages are, much like residential mortgages, a long-term long which is used to purchase or refinance a property. As with residential mortgages, the lender takes security over the property or land in question and allows you to borrow money against it.

Commercial mortgages aren’t just used to raise money against commercial or semi-commercial property, usually almost any security can be considered. It’s common to see a commercial mortgage used to fund land or even predominantly residential security, such as large HMOs, large buy to let portfolios and holiday lets.

Commercial mortgage uses

Funding can be arranged for one of two main reasons:

• To purchase or refinance a property for your business to trade from;
• To purchase or refinance a property as an investment.

Although almost all applications will come down to one of these two reasons, each application will have its own intricacies and lenders will be flexible in understanding your circumstances.

As mentioned above, unlike residential mortgages, commercial mortgage lenders are generally quite flexible in the security offered. Commercial mortgages can be an ideal option for unusual properties, or even to raise finance against land.

The documents needed to apply for a commercial mortgage

When you apply for a commercial mortgage, the lender will usually want to see a number of supporting documents to help them assess your application. Although the exact documents required will vary from lender to lender, there are a number of documents that are commonly requested.

Firstly, the lender will want to check that the proposed mortgage is affordable. To do this, they will request a copy of the latest two years accounts for owner-occupied applications, or a copy of the lease, or leases for investment properties.

These documents are used to assess the proposed repayment against the money coming in.

In addition to the accounts or leases, the lender will also request 3-6 months bank statements, which will be used to check your account conduct. This gives the lender an understanding of how much of that income is left at the end of each month, and how well the account is managed.

For investment properties, only personal bank statements are required. For owner-occupied properties, the lender will also request your business bank statements.

The final document that is requested on almost every application is an assets, liability, income and expenditure summary. This gives the lender a breakdown of your personal cash flow and net worth positions.

This document provides a simple insight into your personal finances and alerts them to any potential future problems.

How are commercial mortgages assessed by lenders?

The processing of commercial mortgage applications is more of a manual process than residential mortgages, which are largely assessed by a computer.

Lenders will often take a common-sense approach to situations and will look at the bigger picture to fully understand the circumstances surrounding the application.

The other big difference between residential and commercial mortgages is that the valuation is undertaken later in the process. A surveyor is not usually instructed until after the mortgage offer is issued.

As a result, applications tend to take longer than standard mortgages, with applications usually taking 6-8 weeks to complete on average.

Commercial mortgage rates and terms

Commercial mortgage rates can vary widely between lenders. For an owner-occupied application, rates of between 2.75% and 3.75% are average for high street lenders.

Commercial investment rates range from 2.85% to 4% on average from the high street banks.

Challenger banks will usually charge a little bit more but will be more flexible in their lending criteria. Rates start from 4.29% and tend to hit around 7% for higher risk, higher loan to value applications.

In addition to the interest charged, lenders will usually charge an arrangement fee of between 1.5-2%. This is usually paid on completion and can be added to the loan in most cases.

Owning a home is one of the biggest dreams for many, yet the process of buying any property can be laborious and flooded with additional fees, delays and disappointments. Blockchain may just be able to chain that. Below Finance Monthly benefits from expert insight from Kai Peeters, the Founder and CEO of HiP, on the implementation of blockchain in the real estate sector.

We are now bearing witness to blockchain based technology coming out of its infancy, and showing how it can be applied to vastly improve multiple markets - including the archaic property market. With a few established businesses and technology giants warming to blockchain, we have to start asking more profound questions about/around how it could improve the situation for a buyer/ buyers and the real estate market as a whole.

The current housing market simply does not work for the majority of first-time buyers. Working exclusively with traditional financial institutions, real estate markets around the globe confine first-time buyers in long-term unmovable loans that put enormous pressure on young people looking to buy a home. This is why, despite interest rates being reasonably low, the number of new mortgages has been declining since the 1990s. Meanwhile, the minimum deposit is largely unaffordable for people who earn average wages, and without help from their family it is virtually impossible for them to get on the property ladder. Technology can transform the way we buy and sell real estate by eliminating additional costs and disorganization of our housing market, Smart contracts that can handle that aspect more efficiently.

Having a decentralized real estate platform addresses current market issues, and introduces the individual investors who can fill the void left by traditional financial institutions and inject more life into the market. This can also allow property to become a more valuable asset in itself, where each buyer is able to release equity without losing ownership, and raise money free of debt. Being able to turn equity into currency and have control over debt levels brings the choice back to the buyers, owners and investors.

The upcoming platform HiP was designed with all those benefits in mind, especially for first time buyers, who can use an inbuilt calculator to enter the price of the property they want to purchase as well as the down payment and monthly payments they can afford. HiP will then calculate the remaining amount needed to buy the property and this outstanding amount is offered out to investors. This means that the first-time buyer will own a percentage of the property whilst also being entitled to a proportional percentage of profit and capitals gains when sold. Investors on the HiP Exchange who have co-financed the property will also receive return on their percentage of the real estate equity they own.

This is a new world of opportunity for first time buyers who now have access to other financing options that were previously unattainable to them. With HiP focusing on the way we fund properties, and other innovative minds using blockchain based technology in other areas of the real estate sector, it is only a matter of time until the array of problems within the real estate markets becomes a thing of the past.

A bridging loan is very different from a standard bank loan, but how so? Financing expert at ABC Finance, Gary Hemming explains the ins and outs of a bridging loan for Finance Monthly.

A bridging loan is a type of short term property backed finance. They are often used to fund you for a period of time whilst allowing you to either refinance to longer term debt or sell a property. Finding a bridging loan can be difficult, but leading online comparison sites can help you compare types of loan and the best loan for you and your needs.

Bridging loans are usually offered for between 1-18 months, with the loan repayable in full at the end of the term. Unlike other forms of borrowing the monthly interest is often rolled into the loan, meaning there are no repayments to make during the term of the loan.

The application process is usually far simpler than for other types of borrowing and applications can complete very quickly, usually in 5-14 days.

Bridging finance can be offered against almost any property or land and can be used for a number of different reasons. The main uses are:

• Purchasing a property quickly – such as auction purchases
• Buying uninhabitable property
• Funding property restoration or conversion work
• Repossession prevention
• Buying property under market value

Other than that, it can be used to secure the end life of seniors by buying senior life insurance policy. Such policy can be found in Seniors Life Insurance Finder.

The pros and cons of bridging loans

Bridging loans are undoubtably a very useful tool when looking to raise finance, but they can be riskier than other forms of finance. As such, it’s important to carefully consider your options before proceeding and specialist advice is always recommended. There are a number of pros and cons to consider before committing to a loan and online jobs for college students.

Pros

• Applications are usually completed in under 14 days, making them ideal when funds are needed quickly.
• As there are often no monthly repayments to make, bridging finance can be used to raise capital where cash flow is tight, but you have the assets to comfortably repay the loan.
• The bridging market is very competitive, and this is leading to a reduction in interest rates. With rates starting from as little as 0.37% per month, bridging finance has never been cheaper.
• Where properties are being purchased under value, lending can often be based on the full value of the property, meaning it’s possible to purchase a property without a deposit.
• Bridging loans can be used to purchase properties that would be ineligible for borrowing using other types of borrowing, such as property that is not habitable.

Cons

• Bridging loans are more expensive than traditional mortgages. Although rates are dropping, traditional mortgages are still by far the most economical option for most property transactions.
• As most loans are very short term, if you have problems with your chosen method of repayment, you can face major issues. Failure to repay the loan at the end of the term would eventually lead to repossession, and most likely significant costs.

Things to consider before taking out a bridging loan

There are a number of key things to consider before taking out a bridging loan, taking the time to consider:

Always Consider Total Cost

When comparing products from different providers, always consider the total cost of the loan, rather than just the interest rate. People often chase the lowest interest rate, but many lenders will charge large exit fees, fund management fees and other ‘hidden’ costs.

Always ask for a breakdown of the total cost of taking the loan before proceeding as this makes it much easier to compare different providers.

Is Your Repayment Method Viable?

The main danger when taking out a bridging loan is that you will be unable to repay the loan at the end of the term. Always consider how the loan will be repaid upfront and make sure the proposed exit is viable.

If you’re planning to sell your property, make sure the term of the loan gives you sufficient time to find a buyer and for the sale to complete. If you’re forced to pursue a quick sale, you could end up receiving far less for your property than you would like.

If you plan to refinance onto a longer-term loan, you should check that your application is likely to be accepted. Where possible, aim to get an agreement in principle from your chosen lender before completing on your bridging loan.

Am I Getting the Best Possible Deal

The difference in cost between different providers can be significant. In addition, some lenders can only be accessed through a limited number of brokers, meaning you may not be able to access the lowest rates.

By checking with 2-3 providers, you will give yourself the best possible chance of securing the best deal.

To hear about mortgage misconceptions and the challenges that potential homeowners face in California, Finance Monthly talks to broker and owner of Mortgage Express – Carole Ryan.

What are the key misconceptions among buyers in relation to mortgages?

Buying your first home should be an exciting and fun endeavour, but I think a lot of potential first-time homebuyers are held back by misconceptions of the loan approval process and the fear they may not qualify. Two of the biggest misconceptions are that they need 20% down and perfect credit. But not anymore - Fannie Mae’s, HomeReady mortgages, and Freddie Mac’s

Home Possible® and Home Possible Advantage® mortgages are new and innovative conventional programs that bring a whole new set of underwriting guidelines to help more low to moderate-income borrowers realize their dream of home ownership. Down payments of 3%, FICOs starting at 620 with most lenders, and higher debt-to-income ratio’s in some circumstances.

Another change by Fannie and Freddie that took effect on 1 January 2018 will also help buyers buy more with less down. The conforming and high-balance loan limits were increased. Now buyers can put 3% down on loans of up to $453,100, whilst in high-balance areas, from $453,101 to $679,650, the minimum down is 5%. The bottom line here is that if you are seriously interested in buying a home, there are options out there to help your achieve your dream of homeownership. The only thing that you have to do is to take the first step - find a good lender and get preapproved.

What are the key challenges that your clients face before applying for a mortgage and how do you help them overcome them?

As a broker with over 25 years of experience in mortgage lending, I work with all types of buyers. I find that almost all of the clients that I advise face challenges revolving around what I call the BIG 3 - income, credit and funds to close. If we have a debt to income issue, we look at adding a co-signor, and/or paying off debt, or as a last resort - buying less. I help borrowers resolve minor credit issues that don’t keep them from getting a loan, those with major issues, I refer to a great credit restoration company I work with.

There are several solutions for funds to close. The easiest one being a “gift” from a family member, a lender credit, based on the interest rate chosen, a seller credit, a loan against or liquidation of a 401K, and of course a variety of down payment assistance programs.

What makes your company unique when compared to your competitors?

What makes me and my company unique is very simple - I’m able to provide incredible hands on service to my clients, built around their schedules and needs. Mortgage Express is my company and I handle all of the loans that I work on personally - from pre-approval to close of escrow. This allows me to oversee my files, keeping everyone involved in the transaction updated and being sure we’re always on track to meet the closing date. I meet with borrowers on-line in a unique screen share, based on the time of day, night or weekend that is convenient for them, whilst they can attend from the comfort of home. This allows me to show them, in real time, how their income, debt and assets affect the loan they can qualify for, as well as ways to restructure the loan in different ways, based on their needs. All of this as they watch, ask questions and request changes. It’s also a great opportunity for me to educate them about the processes we will be going through so they know exactly what to expect, including our time frame and the items I will need them to take care of. No screen share would be complete without an explanation of how lenders pricing works, showing them the different interest rates, and how pricing adjustments affect the options they will choose from. We wrap up with me preparing an estimate of funds needed for closing. The real magic starts when they get an accepted contract and escrow is opened. In a matter of a few days, I have the loan submitted, appraisal ordered and our initial loan approval. My average closing time is 21 days.

Like the digitisation of all things, challenges will be faced and there are benefits to reap, but often such progress doesn’t take place because the correlation between the two isn’t a positive or favourable one. Below Gemma Young, CEO and Co-Founder of Settled, discusses with Finance Monthly the future of digital in the property sector.

Property is our most important asset class, it's also our most emotional asset. Therefore, getting our home sale or purchase right is not just a big deal for consumers, it's a big deal for the wider UK economy.

Unlike other industries (travel, music, taxi services to name but a few), the real estate model has clung to its traditional roots. Even with the advent of “online” estate agents now in existence for the majority of this past decade, the industry has been slow to adopt the opportunities a digital revolution presents. It’s therefore unsurprising that we're still seeing the same issues; typical property transactions take over 3 months with 1 in 3 transactions breaking. This drives consumer losses in excess of £250m each year.

Looking forward, is 2018 going to be the year for true transformation? Will ‘proper’ property technology companies make a dent in the things that matter?

What drives transformation?

Technology

The emergence of truly disruptive technologies including artificial intelligence, virtual reality, blockchain and drones all hold their potential disruptive keys to a more progressive future. Not only are technologies proliferating, consumers also have easy access to them from their smartphones.

Empowered individuals

Tech-enabled consumers search for greater transparency, more control and ultimately more progressive solutions to age-old problems. Their quests for modern, digital solutions provide exciting opportunities for change.

Investment

2017 saw the most significant investment in ‘proper’ proptech to date, with a new and forward-focused collective attracting financial backing from VCs and traditional property players.

Regulation

Central and regulatory initiatives represent a particularly exciting shift. The latest Government call for evidence “Improving the home buying and selling process” and the HM Land Registry’s Digital Street scheme look towards a future where technology (including blockchain) will make the transfer of property ownership much more fluid. Such initiatives shine a light on the underlying problems apparent in the UK property market and signal a commitment to a more open and less guarded future.

How does this future look?

As we see this convergence in consumer, regulatory and technology worlds, this more futuristic property market is well within reach. So who wins? The opportunity to embrace and adopt new technology is open to all, however, historically, traditional incumbents have been slow to move in many sectors. They, therefore, get left behind or quite simply, left out. We don’t have to look far to see examples; Blockbuster and HMV are businesses which didn’t, in time, connect to the opportunities of the next generation. As a result, nimble and forward-focused entrants Netflix and Spotify won the respective leading positions in the new world. Much like in the movie and music sectors, forward-focused businesses tend to win in other worlds.

Settled.co.uk is one example of a real estate business that is connecting across these converging elements at quite a unique time in real estate history. Settled’s unique technology has significantly increased the likelihood of completing on a home and has cut the time it takes to sell and buy in half. It presents the hope that, in the future, its technology will enable people to buy and sell properties in moments, not months. This is the kind transformation this sector needs.

Germany is no longer the most popular destination for commercial real estate investment, according to BrickVest’s latest commercial property investment barometer. Formerly the most popular location in Q3 2017, Germany has now fallen in favour among investors behind the UK, US and France.

Germany saw a drop in popularity from 34% to 23% in the last quarter, marking its lowest rating since Q2 2016. The UK, however, rose from 27% to 29% in Q4 2017, managing to sustain its favourability by consistently ranking above 25%.

Both the US and France have also gained popularity with investors, with nearly one in five (19%) preferring the US over other regions and 18% now selecting France as their location of choice (up 4% since Q2 2016).

The Barometer also revealed that the hunt for income ranked highest (38%) as the primary investment objective of BrickVest investors this past quarter. This has risen by 6% from 32% in Q3 2017.

Notably, interest in secondary cities as target markets continues to steadily increase (from 37% in Q3 2017 to 41% by the end of 2017). These include Birmingham, Newcastle, Bristol etc.)

Emmanuel Lumineau, CEO at BrickVest, commented: “Our latest Barometer reveals that Germany is no longer the favoured destination for commercial real estate investment, contrary to its position in Q3 2017. Rather, the UK has once again become the most popular region for our investors.”

“There have been similar changes in other aspects of the data, including the greater emphasis placed on the hunt for income and the growing popularity of secondary cities as target markets. As the year progresses and we continue to conduct our Barometer, it will be interesting to see how the industry adapts to these underlying factors affecting the real estate market.”

(Source: BrickVest)

This new year, there is one question on the lips of business men and women around the UK: “Is now the best time to purchase commercial property?” Thus, commercial property experts, Savoystewart.co.uk, have analysed how the market faired in 2017, and whether 2018 is the ‘peak time’ to buy.

The latest Property Data Report shows that since 2000, the value of the UK’s commercial property stock has grown, considerably, at an average of 3% each year – surprisingly, more than RPI inflation, which grows at an average rate of 2.8%.

Whilst exploring the report, Savoy Stewart found that the commercial property market in the UK in 2016 was valued at a staggering £883 billion, representing 10% of the UK’s net wealth. Investors now own £486 billion worth of commercial property in the UK; with overseas investors owning 29%.

In central London alone, around £2.4 billion was invested in commercial property, resulting in the total turnover for the end of July reaching a substantial £11.5 billion – a 24% increase on the same point a year earlier, in 2016.

July was the strongest month recorded for the City of London since March 2007, owing to the sale of the “Walkie Talkie” building – the UK’s largest single office building deal – which accounted for a staggering 61% of turnover.

Is now the best time to purchase commercial property?

2017 was a much stronger year than many ever anticipated. The economy pleasantly surprised many businesses and forecasters, with unemployment falling to the lowest level since 1975, consumer spending robust, and occupier take-up healthy.

According to Knight Frank, London office take-up is on the rise, despite the impact of Brexit, with demand in the West End at its highest for more than a decade. Savoy Stewart concluded, from their analysis of the research, that the third quarter of 2017 recorded the highest level of office take-up.

A substantial 3.8 million square feet of office space in central London was under offer and was due to close by the end of the year – and it is predicted to be the strongest final quarter since 2014. Office take-up in the West End alone reached 1.65 million square feet.

Trends in 2018

The uncertainty over the UK’s relationship with the EU will continue to cast a shadow over economic growth throughout 2018, resulting in a more cautious outlook amongst investors across all commercial property sectors. As a result, activity may be subdued, but it doesn’t

mean investment will stop any time soon, as investment volumes in the UK commercial property market, this year, are expected to total around £55 billion, per a report by JLL.

Savoy Stewart considered Savills ‘Sector Outlook’ and summarised the six main trends for commercial property in 2018:

1. Non-domestic demand for UK commercial property to remain strong; Due to the weakening of the pound and commercial property yields looking high in comparison to prime European and Asian markets.
2. Now is the best time to add value, and for opportunistic investors; Less competition and falling prices means now is the best opportunity to value-add and for opportunistic investors looking to change short-term income into long-term.
3. Real earnings growth will improve for the retail market; In 2017, a perfect storm of negativity hit retail, but this year will better news. Watch out for good buys in some segments of the commercial property market – don’t just buy because it’s cheap.
4. Brexit: It will become clearer how much, where and when the risks will be. London’s office market shrugged off the worst of the pre-Brexit negativity last year; 2018 will see more balance.
5. 2018 will be the year of ‘alternatives’; The pace of recovery will be dictated predominantly by Brexit; investors this year will be exploring new opportunities in the market.
6. New-tech tools, such as AI, will emerge; Wellness and staff satisfaction will continue to be important for employers, but some businesses will start to look at offsetting the costs of delivering wellness by using artificial intelligence.

Managing Director of Savoystewart.co.uk, Darren Best, discusses his view on commercial property investment in 2018: “As the figures show, despite the uncertainty around Brexit, London is still a pre-eminent city and performing better than Europe in some sectors. The research suggests that now is the best time to purchase commercial property in the UK, now that business confidence is more stable than many expected, which speaks volumes.”

He added: “The performance of the market, last year, surprised many of us. Occupiers are continuing to commit to London commercial property to satisfy their needs, and with the increase in foreign investment in UK commercial property over the last decade and overseas investors now owning 29% of UK commercial properties, it is safe to say 2018 isn’t going to be all doom and gloom – there will be scope for optimism too.”

December mortgage sales in the UK plummeted by 38% (£5.8 billion) on November, according to Equifax Touchstone analysis of the intermediary marketplace. Year-on-year sales dropped by 12.8% (£.1.4 billion).

Residential figures dropped dramatically by 39.6% (£4.9 billion) on the previous month. Buy-to-let sales also tumbled, falling by 32.1% (£853.7 million) on November.

All regions across the UK suffered from a significant mortgage sales contraction in December. The South Coast witnessed the largest slump of 42.1%, followed by the Midlands (40.6%) and Wales (40.3%). Mortgage sales in the North West fell 34.4%, the smallest drop across all the regions.

John Driscoll, Director at Equifax Touchstone, said: “After three months of consecutive growth, mortgage sales in the UK have decreased sharply across both residential and buy-to-let sectors. Traditionally, December is a slow month for sales due to the festive period and other seasonal effects. However, the level of decrease is somewhat concerning for the industry, especially when considering that mortgage sales are down £1.4 billion year-on-year.

“While we expect to see the usual New Year pick-up in the market following a festive dip, there are a number of factors at play which could alter the direction of mortgage sales in coming months. An uncertain economic and political outlook, the onset of Open Banking and whether this will facilitate faster mortgage applications, the end of the Term Funding Scheme and implications for higher mortgage rates, and the subdued forecast for house prices, to name a few, have set the scene for a volatile and uncertain market in 2018.”

The data from Equifax Touchstone, which covers the majority of the intermediated lending market, shows that the average value of a residential mortgage in December was £191,522 (2016: £196,682) and £150,914 for buy-to-let (2016: £158,967).

(Source: Equifax)

Entering the property market has become an increasingly daunting task for many young people in today’s economic climate. As a result, many have looked to government-backed help in the form of help-to-buy schemes and ISAs to turn the dream of joining the property ladder into a reality.

The required deposit can then be saved with the help of high-interest ISAs.

Though purchasing through help-to-buy has become an increasingly feasible option, not all areas of the UK have equal opportunity. Credit experts TotallyMoney have investigated Britain’s best and worst districts, cities and regions to lay down roots utilising help-to-buy schemes.

We researched a number of factors in each district across the UK to determine a ranking, including the number of equity loans utilised in each region (per capita), the number of help-to-buy ISA property completions and the average amount left to pay after government help (based on average property prices). The research uses government data to compare every district of the UK, including Scotland, Wales and Northern Ireland, to generate the complete ordered list of help-to-buy hotspots.

Desirable Districts

Considering the ranking factors mentioned above, of the 388 government-defined regions in the UK, the top help-to buy hotspots were revealed to be:

1. Central Bedfordshire – The Eastern district came up trumps, with a high level of equity loans (1710) per capita, and 245 properties successfully bought using a help-to-buy ISA. The district beat out all competitors as the best place to purchase a property utilising help-to-buy in the UK.

2. Chorley – The Lancashire market town came in second position with a low average property cost (£182,818) making entering the property ladder through help-to-buy schemes more achievable. The district also boasts the lowest average minimum deposit from the top 5 districts (£9,141) and relatively high number of equity loans given out by the government per capita making property ownership more achievable for residents.

3. Cheshire West and Cheshire – The second area in the North West to appear among the top scoring districts, Cheshire West and Cheshire scored particularly highly in terms of the number of help-to-buy ISA property completions per capita where it came out top in the whole of the UK, with 495 residents purchasing homes utilising this scheme.

Help-To-Buy Cities

The research also accounts for the most populated UK cities and which of those offer the best options for buyers looking to utilise help-to-buy options. Of these, the most buyer-friendly cities were revealed to be:

1. Wakefield – Located in a prime spot between Leeds and York, Wakefield tops the UK’s most populated cities for help-to-buy hotspots. The city has one of the highest levels of help-to-buy ISA property completions, helping 610 residents purchase new homes between December 2015 and March 2017.

2. Hull – In second place, and securing Yorkshire as a true hotspot hotshot, the port city scored highly in equity loans per capita. Hull’s low average property cost (£134,452) means that the 5% deposit required is the cheapest of any city at just £6,722.

3. Salford – Home to MediaCityUK, Salford sits in bronze position with 437 residents successfully purchasing homes utilising the help-to-buy ISAs in recent times and a good level of equity loans per capita boosting its ranking.

Joe Gardiner, Head of Brand and Communications at TotallyMoney, said: “Today, entering the property ladder is increasingly being seen as a pipedream for many young people. But with the introduction of government help-to-buy schemes, this dream can become a realistic option. For those thinking of utilising these schemes, knowing where in the UK is the most help-to-buy friendly, and whether your local area is one of these hotspots, is of particular importance to allow buyers to make a responsible financial decision.”

The full ranked map of the UK’s help-to-buy hotspots can be explored here, or the infographic covering the best help-to-buy cities can be viewed here.

(Source: TotallyMoney)

With plenty of change coming in 2018, here Emmanuel Lumineau and Thomas Schneider, Founders of BrickVest, delve deep into the future of real estate for the coming year, prospects of growth and challenges ahead.

2017 was a strong year for the real estate industry. Despite a number of external factors that could have easily affected market performance, low interest rates remained stable and demand in real estate investment products continued to rise.

Brexit

Brexit has clearly had an effect on the UK but we believe that across Europe, there remains strong deal flow levels and investment opportunities. Our recent research¹ showed that one in three (33%) commercial real estate investors highlighted Germany as their preferred region to invest in. This is the first time that Germany has been chosen as the number one region to invest in and ahead of the UK which was selected by a quarter (27%).

The UK saw a drop from 31% in the last quarter and from 32% in the same Barometer 12 months ago. The Barometer also revealed that UK, French, German and US investors are now less favourable towards the UK since last year. 45% of UK, nearly a quarter (21%) of US, a fifth (19%) of French and 18% of German investors suggested they favour the UK this quarter, representing a decrease from last year across the board from 46%, 26%, 28% and 21% respectively.

Despite investors seemingly focussing away from the UK, there has been an abundance of international capital flowing into real estate, almost every major institutional investor globally has been increasing their portfolio allocation to real estate over the last five years mainly because of lack of alternatives.

Moreover the average risk appetite of BrickVest’s investors continues to rise to 52% from 49% last quarter and from 48% this time last year, meaning a sentiment shift from low to balanced risk

Interest rates

The Bank of England’s decision to raise interest rates in the UK in November was momentous for the economy and should signal the start of a series of gradual increases. The Bank decided that inflation is potentially getting out of control and the economy now requires higher borrowing costs. In contrast, the ECB’s decision to unwind its QE programme to €30 billion a month is a glowing endorsement of healthy Eurozone growth and falling unemployment, which will more than likely mean that interest rates will stay at historic lows until at least 2019 in order to help financial markets adjust.

Increasing interest rates has a direct impact on real estate. Higher interest rates and rising inflation make borrowing and construction more expensive for owners, which can have a constraining effect on the market but can also lead to an increase in property prices. In a low interest rate environment, European real estate yields will continue to look attractive and real estate serves as a good alternative to fixed income.

Value in 2018

We expect to see increasing demand for real estate in 2018. Indeed our research² showed that two in five (40%) institutional investors plan to increase their allocation to European commercial real estate while 44% expect commercial property yields to increase in the next 12 months, just 22% believe they will decrease.

We believe that the best value can be found in real estate deals that are not too sensitive to price erosions. Investors should keep a close eye on the risk of high leverage and DSC ratios. We believe that the best investment options for 2018 will most likely be found in value-add real estate in combination with a conservative financing policy.

Investment strategy 2018

Given the fact that we believe demand will remain relatively high in 2018, one of the main challenges will be to find good deals.

Investors will have to find the right balance of higher leverage (due to continually low interest rates) and being able to handle potential price corrections in the event that the market cools off due to external factors such as Hard Brexit, escalation in the US vs. North Korea conflict, etc…

Institutional investors are investing in less liquid secondary and third level cities to achieve acceptable going-in cap rates (cap rates in major markets such as Paris are historically low). Investors will also be forced to look at less traditional investment products such as student housing, services apartments, and senior housing or industrial to get better returns. The overall risk of these investment is that they are in general less liquid and if the market bounces back, cap rates will also increase much faster than in downtown Paris.

In order to manage this problem, some institutional investors are now investing in real estate debt products so that they a.) have their exposure to real estate but b.) also have an achievable exit (i.e. when the loan maturity is reached). We think this might be smart strategy in 2018 given real estate prices are already very high and might fall in the long term (so no upside opportunity but also no real downside risk).

Sectors to watch

We continue to see the highest level of volatility from the office sector as many international firms put decisions on hold over their long-term office space requirements. Our research² with institutional investors highlighted that more than a third (34%) believe the biggest real estate investment opportunities will be found in the office sector and the same number in the hotel & hospitality industry over the next 12 months.

Three in ten (31%) thought the industrial sector would present the biggest commercial real estate investment opportunities over the next 12 months while one in five (19%) cited the retail & leisure sector.

Mifid II

When implemented in January 2018, revisions to the EU’s Markets in Financial Instruments Directive (MiFID II) will radically change the regulation of EU securities and derivatives markets, and will significantly impact the investment management industry. It will have a significant impact for wealth and asset managers on profitability, product offer and their distribution across Europe, operating models and pricing and costs.

As a consequence, we expect MIFID II to widen the gap between global, infrastructure-based players, and local players. Crowdfunding platform may be affected by these changes.

General Data Protection Regulation (GDPR)

GDPR comes into force on 25 May 2018 and represents the biggest change in 25 years to how businesses process personal information. The directive replaces existing data protection laws and will significantly tighten data protection compliance regulation.

Like other industries, real estate companies will have to conduct a risk analysis of all processes relevant to data protection.

Yesterday saw Chancellor Phillip Hammond deliver his second budget.  While the abolition of Stamp Duty, several tax revisions, freezes on several duties, increased investment in AI and Technology and a £3 billion investment into the NHS all came as welcome additions they could not prevent a sharp drop in the UK Growth Forecast following the budget.

So with many experts labelling it a ‘make or break’ moment for Hammond and a somewhat beleaguered Government, we spoke to the industry experts to see what the Autumn budget really means for the Financial Sector in a special extended Your Thoughts: Autumn Budget 2017

Choose your sector below or scroll through to read all the insight.

FinTech & Digital
UK Growth, Investment & Forex
Tax
Healthcare & Retail
Property & Real Estate

FinTech & Digital

Abe Smith, CEO and Founder at Dealflo

London has been a world-leading financial centre since the 19th century, but low growth forecasts and the lack of clarity around Brexit are unsettling for businesses. The Chancellor has had to work hard to ensure that the UK remains an attractive place to invest and innovate post-Brexit. The new National Investment Fund means that even after Brexit, the UK will remain a hub for FinTech innovation and will attract fast-growing tech companies.

Niels Turfboer, Managing Director of UK & Benelux, Spotcap:

The FinTech industry is going from strength to strength and the UK Government can play an important part in enabling FinTechs to continue to thrive.

We therefore welcome Philip Hammond’s promise to invest over £500m in numerous technology initiatives, including artificial intelligence and regulatory innovation, as well as unlock over £20bn of new investment in UK scale-up businesses.

With this assurance, the government has shown a strong commitment to the FinTech sector, which will hopefully help tech companies all around the UK to flourish and grow.

World Economic Forum member Jane Zavalishina, CEO of Yandex Data Factory

The reality is that it is not the scientific development of AI that will be game-changing in the next few years, but instead the more prosaic, practical application of AI across many different sectors.

While AI is too often associated with self-driving cars and robots, the truth is the most significant AI applications that are of most significance to businesses, are actually the least visually exciting. AI that improves decision-making, optimises existing processes and delivers more accurate demand prediction will boost productivity far more powerfully than in all sectors.

But it’s not just productivity that will be significantly impacted – business revenue will also benefit. The beauty of AI lies in its ability to be applied with no capital investments – making it an affordable innovation for businesses to adopt. Unlike what is commonly thought, applying AI does not require infrastructure changes – in many processes cases we already have automated process control, so adding AI on top would require no investment at all. Instead, companies will see ROI within just a few months.

Martin Port, Founder and CEO BigChange:

We welcome this announcement and support for tech businesses from the Chancellor. Financial backing and stability is a huge hurdle facing all start-ups, so I am pleased to see the government pledge more than £20 billion of new investment. I just hope this funding is easy to access and readily available for those who need it, rather than being hidden among reams of red tape.

Leon Deakin, Partner in the technology team at Coffin Mew:

As a firm with a growing technology sector and client base in this area we are obviously delighted to see specific investment in the technology sector, particularly in AI and driverless vehicles.

Doom mongers have long been predicting that the UK and its tech hubs will be hit hard by Brexit and there have been numerous reports of rival cities within the EU which have sought to position themselves as alternative options. However, we are yet to see this materialise and incentives and commitments such as those announced by the Chancellor in these innovative but essential areas have to be great news for the economy, the sector and those who advise businesses in it.

Of course, creating the next unicorn is no easy task but a serious level of investment of the magnitude announced should at least ensure those businesses with promise have the best chance to scale up even if they don’t reach the $1billion level. Likewise, there is little point developing these new technologies if the infrastructure and support is then not there to utilise them properly

Matthew Adam, Chief Executive Officer of We Are Digital:

With the UK economy now expected to grow by 1.5% in 2017, a downgrade from the 2% forecast made in March, coupled with the challenges of Brexit, the need for the UK to sit at the forefront of digital skills and inclusion is more pressing than ever. We need to be able to grasp, with both hands, the digital opportunities that present themselves to us in order to make us a true global digital force.

The reality is that we simply cannot afford not to. Independent analysis shows that getting the UK online and understanding how to use digital tools could add between £63 billion - £92 billion to UK Plc’s annual GDP. Indeed, it is my belief that economies which focus strongly on getting its citizens online are also more productive.

The Chancellor has said that a new high-tech business is founded in the UK every hour, which he wants to increase to every half hour. It is imperative we support this growth through the announced £500m investment in artificial intelligence, to 5G and full-fibre broadband. However, to bridge the need for the 1.2 million new technical and digitally skilled people which are required by 2022, we must create and support retraining opportunities across society to make the UK truly digital.

Technology improvements are causing widespread changes in every market and the public sector should be no exception, especially as it often faces the biggest social problems to solve. I’m glad the government is waking up to the fact that the latest technological advances don’t need to be assigned only to the private sector, but can do a lot of good to the community at large. We know from our direct work with the Home Office that every government and council department is moving its processes online. Whether it’s chatbots to automate processes, or solving how people engage with Universal Credit, there is so much we can do here with ‘Gov -tech’

I therefore welcome the Chancellor’s digital announcements today and consider this budget as not so much a leap in the right digital direction, but more a necessary conservative step.

UK Growth, Forex & Investment

Owain Walters, CEO of Frontierpay:

The Chancellor’s efforts to win younger voters from Labour by abolishing stamp relief for first-time buyers on homes up to £300,000, and on the first £300,000 of properties up to £500,000, come as no surprise. The potential for such an announcement has been a hot media topic in recent weeks and as such, we don’t expect to see any significant impact on the value of the pound.

“In the wake of this Budget, any real movement from the pound will be caused either by developments in the Brexit negotiations or the potential for a further interest rate rise. I would therefore advise any businesses that want to stay on top of turbulence in the currency markets to keep a close eye on inflation data.

Markus Kuger, Senior Economist, Dun & Bradstreet

It’s not surprising that the Chancellor opened this year’s statement with a focus on Brexit; even as businesses absorb the implications of the Budget, they have a close eye to the ongoing negotiations and any likely trade agreement, which is likely to profoundly impact their future. The government’s move to provide a £3bn fund in the event of a no-deal outcome is designed to increase business confidence. In the meantime the business environment remains challenging, and Dun & Bradstreet forecasts that real GDP growth in 2018 will slow to 1.3% (from 1.8% in 2016). Businesses should continue to follow the Brexit negotiations closely and consider that operating conditions could change dramatically over the next 18 months as the Brexit settlement is clarified.”

 Damian Kimmelman, CEO of Duedil

We welcome the government’s announcement that the Enterprise Investment Schemes’ (EIS) investment limit, for knowledge intensive scale-ups has been doubled.

The EIS has been great for attracting investment for small businesses, however we need to ensure investment through the scheme is not being used for capital preservation purposes, but instead to encourage the growth of companies.

The key to increasing investment in ‘higher risk’ growth companies through the EIS scheme, is to eliminate information friction. With more data, investors can price risk effectively, so they can lend to support the small businesses forming the backbone of the economy, driving growth, and creating jobs.

Lee Wild, Head of Equity Strategy at Interactive Investor:

This budget was always going to be especially tricky for the chancellor. Hitting fiscal targets amid wide divisions over Brexit, while also spending more on populist policies to distract voters from Conservative party infighting and dysfunctional cabinet, was a big ask.  Hammond wasn’t fibbing when he promised a balanced budget. Once tax giveaways, downgrades to growth forecasts, billions more for the NHS and the rest are put through the mincer, both the FTSE 100 and sterling are unchanged.

Given Britain’s housing crisis was an obvious target for the chancellor, he really needed something substantial to make his aim of 300,000 new homes built every year anything more than a pipe dream.  Committing to at least £44 billion of capital funding, loans and guarantees to support the housing market will go a long way to achieving the chancellor’s ambitious target. Abolishing stamp duty for first-time buyer purchases up to £300,000 is a tiny saving, however, and buyers, especially in London, will still require a huge deposit to get a foot on the housing ladder.

The market hung on Hammond’s every word, causing a comical yo-yo effect as the chancellor slowly revealed his strategy.  A threat to use compulsory purchase powers where builders are believed to be holding land for commercial reasons, could cause sleepless nights.

Overall, Hammond’s ideas are sound, but probably not enough of a catalyst to get sector share prices rising significantly near-term, given mixed results in the run-up to this budget.

Mihir Kapadia – CEO and Founder of Sun Global Investments:

The Autumn budget statement from Chancellor Phillip Hammond was as expected, with a few pleasant surprises. While Mr Hammond set out his policy proposals with a "vision for post-Brexit Britain", he also acknowledged that his Budget was "about much more than Brexit".  With the Conservatives struggling in the polls, the Chancellor was under pressure to regain support for his party, which is currently in a fragile coalition.

The expected announcements include the decision to abolish stamp duty for first time buyers on properties up to £300,000, addressing the housing crisis, an immediate injection of £3.75 billion into the NHS, investments into infrastructure (transport and network), freezing duty on fuel, alcohol and air travel, and finally a Brexit contingency budget of £3 billion.

While today’s budget was populist and aimed at the electorate, it has to be noted that the Office for Budget Responsibility (OBR) sharply downgraded both Britain's productivity and growth forecasts, as well as its business investment forecasts, meaning the UK's finances look set to worsen over the coming years. This does not factor the possibility of a Brexit-related downturn or a wider global recession, which has already been seen as overdue by many forecasters.

We expect the abolition of stamp duty for first time buyers on properties up to £300,000 will draw extra attention and headlines from much of today’s announcements. It is vital that we acknowledge the warnings from the Office for Budget Responsibility.

Angus Dent, CEO, ArchOver:

The UK’s productivity growth continues to decrease and we’re looking in the wrong place for answers. It’s not just a case of everyone working a bit harder. Investment in public infrastructure and fiscal policy will be the defining factors that help the UK catch up, while real growth will come from our SME sector.

Britain is known as a nation of entrepreneurs. Yet we’re in real danger of not giving our SMEs the support they need to thrive. We need a bottom-up approach where small businesses with bright ideas have access to the finance and advice they need to grow. Only then will we have the firm economic foundation we need to build our productivity post-Brexit.

The expansion of the National Investment Fund in today’s Budget is a good start, but too many SMEs still have to pay their way with personal savings or put their houses on the line as security if they turn to the big banks for help.

We need to inspire a new culture. We know there is an army of willing investors out there who want to support British business - lending across P2P platforms is on course to rise by 20 per cent by the end of this year according to data from 4thWay.

However, we need to raise awareness among SMEs of the different options available to help them finance their growth. SMEs need to take control of their own destiny. With the right finance in place, they can drive the whole country forward to new heights of productivity. We can’t just leave it to government – small businesses must be given the power and the cash to fulfil their potential.

Tax

Paul Falvey, tax partner at BDO:

It’s clear that the headline grabbing news revolved around the Chancellor’s decision to abolish stamp duty for first time buyers on properties purchased up to 300,000, at a cost of £600m a year to the tax man. Whilst this is important for people getting on the property ladder, there were other key assertions.

Firstly, HMRC will start to charge more tax on royalties relating to UK sales when those royalties are paid to a low tax jurisdiction.  Although this is only set to raise approximately £200m a year, it sets a precedent that tax avoidance will continue to be on the governments agenda. Implementing the OECD policies is a tactic we expected.

Furthermore, companies will pay additional tax on the increase in value of their capital assets from January 2018. The expected abolition of indexation allowance will mean that, despite falling tax rates, companies will be taxed on higher profits. By 2022/2023 this is expected to raise over £525m.

62% of the businesses we polled before the Budget said they will be willing to pay more taxes in return for a simpler system. Yet, once again, the government has done nothing to tackle the issue of tax complexity. It is a huge obstacle to growth and businesses will be disappointed that there was no commitment to setting out a coherent tax strategy.

Craig Harman is a Tax Specialist at Perrys Chartered Accountants:

Although it was widely anticipated beforehand, the only real rabbit out of the hat moment for the Chancellor was confirming the abolishment of stamp duty for first time buyers. This equates to quite a generous tax incentive for those able to benefit resulting in a £5,000 saving on a £300,000 property purchase.

The Chancellor has also stood by his previous promises, by raising the personal allowance to £11,850, and the higher rate threshold to £43,650. This is in line with the commitment to raise them to £12,500 and £50,000 respectively by the end of parliament.

Small business owners will be pleased to note that speculation regarding a decrease in the VAT registration threshold did not come to fruition. It was anticipated the Chancellor would look to bring the UK in line with other EU countries, however this will be consulted on instead and may result in changes over the next couple of years. Any decrease in the threshold could place a significant tax and compliance burden on the smallest businesses.

Ed Molyneux, CEO and co-founder of FreeAgent

I don’t believe that this is a particularly positive Budget for the micro-business sector. Rather than actually offering real support or meaningful legislation to people running their own businesses in Britain, the Chancellor has simply kept the status quo.

While it’s pleasing to see that the VAT threshold has not been lowered - which would have added a significant new administrative burden to millions of UK business owners - this is hardly cause for celebration. Neither is the exemption of ‘white van men’ from diesel charges, which is the very least that the Government could have done to protect the country’s army of self-employed tradespeople.

It’s also disappointing that there are still a number of issues including digital tax that have not been expanded in this Budget. I would have preferred to see the Chancellor provide clarity on those issues, as well as introducing new legislation to curb the culture of late payment that is plaguing the micro-business sector and further simplifying National Insurance, VAT and other business taxes.

Rob Marchant, Partner, Crowe Clark Whitehill

The Chancellor announced that the VAT registration threshold will not be changed for the next two years while a review is carried out of the implications of changing this (either up or down).

Having a high threshold is often regarded as creating a ‘cliff edge’ for businesses that grow to the point of crossing that line. However, keeping a significant number of small businesses away from the obligations of being VAT registered allows them to focus on running their operations without additional worry. Many small businesses will welcome the retention of the threshold.

The consultation should look at ways to help smooth the effect of the “cliff edge”, while continuing to reduce administrative obligations for small businesses.

Jane Mackay, Head of Tax, Crowe Clark Whitehill

The tax avoidance debate has centred around large multinationals and their corporate tax bills. High profile cases have eroded public trust in how we tax companies. By maintaining the UK’s low corporate tax rate, currently 19%, and reducing it to 17% from 2020, the Chancellor accepts that corporate tax is only of limited relevance in our UK economy. It accounted for around just 7% of UK tax revenues last year.

The Budget announces changes to extend the scope of UK withholding taxes to tax royalty payments in connection with UK sales, even if there is no UK taxable presence. There will be computational and reporting challenges, but this measure may pacify those who feel the UK is not getting enough tax from international digital corporates which generate substantial sales revenues from the UK

Healthcare & Retail

Hitesh Dodhi,Superintendent Pharmacist at PharmacyOutlet.co.uk

With a focus on Brexit, housing and investment into digital infrastructure, it was disappointing to see a many healthcare issues overlooked in today’s Budget. The additional £2.8 billion of funding for the NHS in 2018-19 is a undoubtedly a step in the right direction, but it falls short of the extra £4 billion NHS chief executive Simon Stevens says the organisation requires.

What’s more, the Budget lacked substance and specifics; it did little to progress digitalisation in the healthcare sector – an absolute must – while the opportunity to promote pharmacy to play a greater role in delivering front-line services to alleviate the burden on GPs and hospitals was also overlooked. These are both items that should feature prominently on the Government’s health agenda, but the Chancellor did little to address either in today’s announcement.

Jeremy Cooper, Head of Retail Crowe Clark Whitehill:

There is little in this Budget to bring cheer to the struggling retail sector.

The changes to bring future increases in business rates into line with the Consumer Price Index in 2018, two years earlier than previously proposed, is welcome, but is it enough for hard-stretched shop owners?

The National Living Wage will increase for workers of all ages, including apprentices, which is excellent news for lower paid employees. Retailers would not begrudge them this increase, but retail tends to have a higher proportion of lower paid employees and the impact on store profitability and hurdle rates for new stores should not be underestimated.

There is more positive news for DIY, home furnishings and related retailers in the form of the abolition of Stamp Duty Land Tax (SDLT) for first time house buyers. This should help stimulate the first time buyer market and free up the wider housing market which in turn should boost retail sales for DIY and home furnishings retailers from buyers decorating and furnishing their new homes.

Property & Real Estate

Paresh Raja, CEO of bridging specialist MFS

After an underwhelming Spring Budget that completely overlooked the property market, this time around the Chancellor has at least announced some reforms that will benefit homebuyers. While stamp duty has been cut for first-time homebuyers, the amount of money this will save prospective buyers is in reality still limited – the average first-time buyer spends £200,000 on a property; abolishing stamp duty for them will save them just £1,500.

Importantly, homeowners looking to upgrade to another property still face the heavy financial burden of stamp duty, which will ultimately deter them from moving house. I fear this will have significant implications in the longer term, decreasing the number of people moving from their first property purchase, and thereby reducing the number of properties available for first-time homebuyers, and reducing movement in the market as a whole.

Fareed Nabir, CEO and founder of LetBritain

“Having acknowledged the growing number of Brits stuck in rental accommodation, it’s pleasing to see the Government deliver a Budget heavily geared towards the lettings market. With 7.2 million households likely to be in the rental market by 2025, the Chancellor has seized the opportunity to continue with the recent wave of reforms by offering tax incentives for landlords guaranteeing tenancies of at least 12 months. This should hopefully have a trickle-down effect on rental prices, offering more financial manoeuvrability for tenants saving to buy their own house – something the Chancellor has made easier – while also providing additional security for renters.”

Richard Godmon, tax partner at Menzies LLP

We should to see house price increases almost immediately on the back of this announcement. His commitment to building an extra 300,000 homes a year is not going to happen until 2020s, so this measure could lead to market overheating in the meantime.

The removal of indexation allowance will come as a further blow to buy-to-let landlords, many of whom have been transferring their portfolios into companies since interest the restriction rules were introduced. This will mean paying more tax on the future sale of properties.

Now that all sales of UK investment property by non-residents after April 2019 will be subject to UK tax, it effectively means one of the incentives to invest in UK property by non-residents has been removed.

Jason Harris-Cohen, founder of Open Property Group 

There was a lot of speculation before the Budget that the Chancellor would reduce or temporarily suspend stamp duty for first-time buyers, in a bid to help young people get on the property ladder. What we got was the complete abolishment of the tax on first-time house purchases of up to £300,000, effective from today, and in London and other expensive areas, the first £300,000 of the cost of a £500,000 purchase by first-time buyers will be exempt from stamp duty. This is arguably the biggest talking point of today’s announcement and as the Chancellor says will go a long was to "reviving the dream of home ownership".

It was equally refreshing to hear that the Government is committed to increasing the housing supply by boosting construction skills and they envisage building 300,000 net additional homes a year on average by the mid-2020s. However, I was surprised that local authorities will be able to charge 100% premium on council tax on empty properties, though I appreciate that this is a further stimulus to free up properties sitting empty and bring them back to the open market to increase supply. Conversely this could result in falling house prices if there is further supply and lower demand following a period of political and economic uncertainty.

What was disappointing, however, was the absence of any mention to reverse the stamp duty change that were introduced in 2016 for buy-to-let and second homes, which is currently deterring people from investing in the private rented sector. The longer it is around the more of a knock on effect it will have on the growing homelessness crisis, a problem the Government plans to eliminate by 2027 - a bold statement from Mr Hammond!

We’d love to hear more of Your Thoughts on Phillip Hammond’s Autumn Budget.  Will it benefit Britain and will the reduced growth forecasts have an impact?  Let us know by commenting below.