31 March 2005

Tax Cafe

On 16th March 2005, Gordon Brown, the UK's longest serving Chancellor of the Exchequer, gave his 9th Budget speech to a packed House of Commons. Most commentators agree that, for one reason or another, this was also likely to be his last Budget speech. Where he'll be this time next year is less certain. At the Foreign Office? On the opposition benches? On the back benches? Nursing his wounds back at home in Fife? Or even at No. 10? Only time will tell.

11 August 2004

ODPM

The Office of the Deputy Prime Minister (ODPM) has created an experimental quarterly index of PRS rents.

There is currently no official published index of private rental sector (PRS) rents even though the Survey of English Housing (SEH) and certain other government surveys have collected data on rent paid for many years.

Given that it is government policy to encourage the development of the PRS, interest in trends in private rents is likely to increase. It is therefore sensible to try and fill this gap using the quarterly data collected by the Survey of English Housing (SEH).
 

11 August 2004

The Bank of England

"The world economic recovery has broadened. In the United Kingdom, output growth picked up to above
trend in Q2. Official data suggest only moderate growth in consumer spending in the first quarter, but
other indicators point to rather greater momentum. There are tentative signs that the housing market is
starting to cool. Investment continued to grow briskly. The Committee’s central projection, on the
benchmark assumption that official interest rates follow a path implied by the market yield curve, is for
continued robust GDP growth in the near term. The rate of expansion then moderates, dipping below
trend for a while. The labour market remains tight and some indicators suggest that domestic price
pressures have increased. Annual CPI inflation climbed to 1.6% in June, largely reflecting a strong
contribution from petrol prices. On the central projection, CPI inflation drops back in the near term and
then gradually moves up in response to pressures on supply, flattening off at around the 2% target after
two years." Bank of England August 2004

20 July 2004

The Treasury

In April 2003 the Chancellor asked Kate Barker, a member of the Bank of England’s Monetary Policy Committee to undertake a review on the responsiveness of housing supply in the UK.

Her interim report recommended “there is merit in the Government considering a vehicle, based on the US Real Estate Investment Trust (REITS) model, to encourage increased institutional investment.”

In response, this document launches a consultation on how the structure of a new Property Investment Fund might be developed for the UK. It responds to concerns that barriers in the tax system may be contributing to distortions in the market for property investment, resulting in poor liquidity, barriers for smaller investors entering the market and high debt financing levels, all of which may be hindering progress towards a more stable and efficient market, better able to support the Government’s economic objective.

Responses where requested by 16th July 2004

The RICS, the British Property Federation and the Investment Property Forum have now submitted their proposals for a UK real estate investment trust to Government.

This joint submission recommends a "light regulatory touch" to make the new investment vehicles attractive to potential investors.

REITs in the UK could open up commercial property investment to smaller investors, and attract greater institutional investment in the private rented sector.
 

06 May 2004

The Bank of England's Monetary Policy Committee has today voted to raise the Bank's repo rate by 0.25 percentage points.

The Bank of England thinks the global economic upswing has been maintained and in the U K, output growth has continued at or above the recent trend line and business surveys are consistent show strengthening. Retail spending continues apace, being underpinned by income growth and stronger than expected house price inflation. Generally, the bank feels, investment prospects have improved.

Inflation has been below the 2% target and the committee feels this is likely to continue in the short term. However, earnings growth has picked up and commodity prices have risen sharply. With a small and diminishing margin of spare capacity, inflationary pressures are likely to build despite a higher level of sterling than at the beginning of the year. It's against that background, that the Committee judged that an increase of 0.25 percentage points in the repo rate to 4.25% was necessary to keep CPI inflation on track to meet the target in the medium term.

The Committee's latest inflation and output projections will appear in the Inflation Report to be published on Wednesday 12 May.

 

06 April 2004

The Chancellor Gordon Brown brought the introduction of a US-style Real Estate Property Unit Trust a stage further in the UK in his 2004 Budget speech with the announcement of a public consultation process. See the Treasury consultation paper below.

The aim of the REIT investment vehicle is to introduce more flexibility into the UK real estate market.

The Royal Institution of Chartered Surveyors (RICS), in conjunction the British Property Federation (BPF) and Investment Property Forum (IPF) have submitted a paper on their views to Government (Sept 2003) - see link below.

23 March 2004

• Budget 2004 Briefing - Provided to LandlordZONE by TaxCafe - On-Line Property Taxation Specialists and Tax Guide publishers
• Budget 2004 Briefing - Provided to LandlordZONE by Yardleystar.co.uk - Accountancy for Small Businesses, specialists in property taxation.

23 March 2004

Office of the Deputy Prime Minister Creating Sustainable Communities

Making it Happen the Northern Way

Creating Sustainable Communities: Making it Happen the Northern Way

It has been one year since the launch of the Sustainable Communities Plan: Building for the Future, which is an action plan to build successful, thriving and inclusive communities where people want to live. Copies of the Sustainable Communities Plan are available on the Office of the Deputy Prime Minister's website.

MAKING IT HAPPEN – THE NORTHERN WAY

£86m over two years to revive Merseyside housing market

'Northern Growth Corridor' established to attract investment

Manchester to host major national/international regeneration conference

Vision of a stronger Northern economy acting as counterpoint to overheating South

Speaking in Manchester Deputy Prime Minister John Prescott launched a major raft of measures to reduce regional inequality between North and South.

In a major update to the £22bn Communities Plan introduced last year, the ‘Making it happen – the Northern way’ report outlines plans for the Government to work more closely with the North West Regional Assembly (the Regional Planning Body for the North West of England) and the North West Development Agency to quicken the pace of change in the region.

From the event, North West Regional Assembly Chairman Tony McDermott said:

“The Northern Way is the only way to ensure that Northern communities can play catch up with the prosperous South. The Deputy Prime Minister has always recognised the need for distinct Northern solutions for the very different problems faced by our communities. This report backs words with a multi-million pound package delivering jobs, growth and housing renewal in the region’s towns and cities.”

As part of the programme of measures Mr Prescott announced £86m funding for the Merseyside market renewal pathfinder to help tackle the most acute areas of low demand and abandonment. Three other areas in the North West will receive a share of an £89m liveability fund to improve the state of parks and public spaces.

Manchester will host the Delivering Sustainable Communities Summit early 2005. Following from the Urban Summit 2002 it will be the largest international regeneration event to be held in Britain, attracting the world’s leading experts to the North West.

John Prescott said:

“We need a long-term vision, as well as investment. So I look forward to working with the regional development agencies and the regional planning bodies on a plan to exploit existing infrastructure – airports, motorways and rail lines. And we will continue to work with them to identify ways of increasing economic growth in the regions – raising skills, enterprise, investment, innovation and competition, and getting people back into jobs.

“By raising the economic performance of the North to that of the English average, the three Northern regions would be around £30bn per year better off, that’s around £2,000 per person. Catching up with the average would also generate an extra 200,000 jobs.”

Issued by the North West Regional Assembly – THE LEADING ENGLISH REGION

For further information please contact Simon Crawshaw, NWRA Communications Manager

on 01942 776933, 07971 295561,
Fax 01942 776940

Email simon.crawshaw@nwra.gov.uk