In his second Budget of the year, the Chancellor said housebuilding would get the “largest cash investment in a decade”
Mr Sunak promised a multi-year investment of nearly £24 billion to build new homes.
He confirmed £1.8 billion would be spent on developing 1,500 hectares of brownfield land unlocking one million new homes and £11.5 billion investment through the Affordable Homes Programme.
“This works out at £11,250 per home,” said Lawrence Bowles, senior research analyst at Savills. “This is enough to make a difference on some brownfield sites but will be a drop in the ocean compared to costs on more heavily contaminated or complex sites. It’s also worth noting there simply isn’t enough brownfield land to build anywhere near housing needs.
“However, it does recognise that people want to live in well-connected, urban locations, close to work and local amenities.”
Martijn van der Heijden, CFO at mortgage broker Habito said: "There is a shortage of affordable homes and any new home-building programs could help alleviate some of this pressure.
“However, these homes need to be built to new green standards, to help the Government’s plans to decarbonise UK housing stock.
“For too long, there has been a ‘green premium’ across all ‘environmentally-friendly’ products. There shouldn't be a financial penalty for saving the planet - it can't be the preserve of the rich or the superfans - solutions must be affordable."
The Chancellor announced £5 billion to remove dangerous cladding from high rise buildings, partially funded by the Residential Property Developers Tax to be levied on developers with profits over £25 million at a rate of four per cent.
Mr Bowles said only 31 developers made profit of more than £25 million in 2019, the last year when housebuilding was not disrupted by the pandemic.
No mention was made of buildings with potentially unsafe cladding below 18 metres, where thousands of leaseholders remain unable to sell their homes.
Mary-Anne Bowring, group managing director at leading property management consultancy, Ringley Group, said that while a blanket tax on developers was fairer than forcing leaseholders to pay, those directly to blame for unsafe building should be held accountable.
“That those responsible should cover the costs of what is ultimately a multi-billion pound myriad of mistakes is an obvious resolution to anyone, and it’s frankly bizarre that we’re still debating this when recent fire safety legislation provided the perfect opportunity to protect vulnerable leaseholders.
“Instead, those most affected are more unclear than ever as to their obligations, or who to turn to, and are increasingly sidelined in discussions about fire and building safety.
“Replacing unfit cladding systems continues to eat away at the Building Safety Fund at an alarming rate of £30m a month, and these allocations only cover high-risk buildings. Empowering leaseholders and occupiers with a voice should be at the forefront of future Government action.”
The Chancellor promised £65 million to ramp up England’s planning system, including digitisation to make local plans easier to access.
Trevor Morriss, principal architect at SPPARC warned a digitised planning system could hinder direct communication between architects and the public.
But Russell Pedley, co-founder and director of Assael Architecture, said: ““We welcome any digitisation that simplifies planning, preferably with a zonal approach that would make it more transparent and easier to hear a range of voices representative of local communities.
“It would also, in our view, attract more national and international funding by providing certainty to investors. In promoting digital means of consultation, we’d expect to see genuine engagement that takes us out of the Stone Age and into the sensible, modern use of planning technology.”
Despite pressure from some parts of the property industry, there was no extension to the stamp duty holiday, which cancelled the buying tax for homes up to £500,000.
Estimates say the resulting tax cut of up to £15,000 caused a “stampede” in the property market and pushed house prices up by as much as 20 per cent.
Matt Turner, founder of Astute Property Search, said: "The SLDT holiday from last year’s budget had a notable effect on market activity, so a cut or review to the current rates would likely have buoyed many buyers, but in its absence I think it will very much be business as usual.
“In recent weeks we have seen a significant upturn in international buyer enquiries, so it is welcomed that there are no additional taxes on overseas buyers that when introduced previously have proved a deterrent to some.”
Nick Leeming of Jackson Stops said: "The SDLT holiday has been incredibly effective in supporting the market through a challenging 18 months. As Britons place a renewed importance on their homes, factors beyond a financial saving are in play and buyers are acting with intent. According to our research, there are now 25 buyers chasing every available property, as buyers reassess how their home contributes to their changing lifestyle aspirations.
“It is disappointing that we didn’t see further long-term measures put in place to support the housing market - taxation is one of the biggest barriers facing property buyers and further reform would encourage fluidity across the buying lifecycle.
“Finally, it also helps to sustain thousands of jobs which rely on the property market, including tradespeople, removal companies and suppliers of white goods, and supports a thriving property market for years to come.”