Industry gives cautious welcome to Healey’s first Budget
The housing industry has given a broadly positive but cautious response to Chancellor John Healey’s first Budget, welcoming measures to support first-time buyers and affordable housing while warning that development viability remains a significant challenge.
The Home Builders Federation (HBF) highlighted the potential benefits of the new Your First Home equity loan scheme and additional affordable housing funding, although industry representatives questioned whether the announcements go far enough to address the costs and regulatory burdens holding back delivery.
The Government’s Your First Home scheme is expected to launch in spring 2027, offering first-time buyers an equity loan of up to 20% backed by £4.7bn of government funding, with the aim of supporting the delivery of around 20,000 new homes.
Meanwhile, the Government has announced that Biodiversity Net Gain (BNG) requirements will be removed for smaller brownfield developments of up to 1.5 hectares, alongside a commitment to avoid major changes to building regulations during the remainder of this Parliament, except where necessary for building safety.
The Social and Affordable Homes Programme will receive an additional £1.5bn, taking its total funding to £40bn over ten years and supporting the delivery of a further 10,000 homes, with the Government also extending preferential borrowing rates for councils and introducing VAT relief on land sold to registered providers.
Separately, the Government will increase the income eligibility thresholds for shared ownership from the new year, raising the cap from £80,000 to £90,000 outside London and from £90,000 to £110,000 in the capital.
Annual house price growth slows to its weakest level since January 2024
Nationwide reported that annual house price growth slowed to 0.5% in October, down from 0.8% in September and representing the weakest annual increase since January 2024, while prices remained unchanged month-on-month at an average of £273,566.
Housing delivery forecasts downgraded as registrations fall
The Office for Budget Responsibility (OBR) has reduced its forecast for housing delivery by 190,000 homes over the five years to 2030/31 compared with its March prediction, citing weak demand, higher interest rates and increased regulatory costs, including the Building Safety Levy and Biodiversity Net Gain requirements.
Meanwhile, the National House Building Council (NHBC) reported that new home registrations fell by 13% in the third quarter compared with the same period last year, with private sector registrations down 8% and rental and affordable registrations falling by 23%.
Research from the HBF and Quantum Development Finance found that 96% of SME housebuilders are hesitant to invest in new developments because of current market conditions, highlighting the continuing uncertainty facing smaller developers.
Developer and supply chain updates
Midlands housebuilder Morro Partnerships reported a 28% increase in turnover to £127.7m for 2025/26, with a development pipeline worth £500m and plans to deliver 2,500 homes across the region.
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Vistry has appointed Helen Miles, currently Chief Financial Officer at Severn Trent, as its new CFO and executive director, with Miles due to join the housebuilder in 2027, while Robert Allen has been appointed interim CFO with immediate effect.