Thursday, 7 December 2017

Landowners reap benefits of soaring British land prices




UK’s net worth rose by £803bn over the course of last year to stand at £9.8tn at the end of 2016, says ONS

Britain’s landowners have emerged as the biggest winners from the country’s largest yearly increase in national wealth on record, sitting on assets accounting for more than half of the net worth of nearly £10tn.

The UK’s wealth rose by £803bn over the course of last year to stand at £9.8tn at the end of 2016, driven by a sharp increase in the value of land, contributing to the biggest annual rise since records began in 1995, according to the Office for National Statistics.

The value of land has increased more than fivefold over that period, outstripping the increase in the worth of the properties overlying it.

The value of the country’s wealth – as measured by assets accumulated by households, businesses and the state - has risen steadily over the past two decades, barring small setbacks during the financial crisis which have now been left well behind.

Total land value has recovered from a fall of almost £1tn recorded in 2008 amid a crash in house prices during the credit crunch, recovering to its pre-crisis peak in 2014 and rising by £280bn over the course of 2016 to stand at £5tn at the end of last year.

According to a 2010 report for Country Life, a third of Britain’s land still belongs to the aristocracy, while some of the oldest families in the country have held onto their land for several centuries. Some of the most famous noble landowners include the Duke of Westminster, who owns large chunks of Mayfair and Belgravia in London. The Queen’s Crown Estate owns most of Regent Street and swaths of St James’s, as well as thousands of acres of farmland, forests and coastline. There are also vast tracts of land owned by the government, including areas controlled by the Forestry commission, which is thought to be the country’s biggest land manager, with about 900,000 hectares.

The ONS analysis measures the total net worth of the country by estimating the market value of financial assets, such as loans, and non-financial assets, such as land and dwellings. The figures show households and non-profit institutions such as churches, trade unions and social and cultural organisations account for the vast majority of the nation’s wealth.

The £803bn increase in UK net worth from 2015 to 2016 is the largest annual rise on record

The statisticians estimate the net worth attributable to central government stood at negative £1.2tn as a consequence of borrowing to fund the budget deficit.


The former Labour prime minister said the new tax – which would be a levy on underlying land rather than property on it – should replace council tax and business rates to create a “fairer and more rational system of property taxation”.The stark illustration of the gains made by land owners come days after Tony Blair endorsed the idea of a new “land value tax” put forward in Labour’s last manifesto to help solve the country’s housing crisis.


Blair said the new tax, which sees the value of underlying land taxed rather than property, should replace council tax and business rates to create a “fairer and more rational system of property taxation”.

Philip Hammond placed a stamp duty cut for first time buyers and more money for housebuilding at the heart of the budget last month, pledging to boost the number of new homes built to 300,000 a year on average by the mid-2020s – up from 217,000 last year – in the “biggest annual increase in housing supply since 1970”.

The chancellor also said he would do more to tackle land banking – where housing developers sit on land waiting for its value to increase before selling properties for higher prices – with a promise to reform planning rules. Conservative grandee Oliver Letwin, who was David Cameron’s head of policy, will also review the gap between planning permissions and housing starts on behalf of the government.

Letwin’s panel will provide an interim report in time for the Spring statement next year, which Hammond could use as grounding to intervene in the market should it find land being withheld for commercial reasons, rather than technical ones.


There are as many as 270,000 residential planning permissions unbuilt in London alone. Hammond has said that options open to the government could include compulsory purchase powers.




https://www.theguardian.com/business/2017/dec/05/landowners-reap-benefits-of-soaring-british-land-prices?utm_term=Autofeed&CMP=twt_b-gdnnews#link_time=1512513172

Wednesday, 6 December 2017

Indian buyers pouring money into expensive London property

                                  Indian buyers are looking to buy property like this one near Hyde Park


Indian buyers are pouring into central London’s lethargic high-end property market after a change to how much money they can take out of their home country.

Buying agency Black Brick said that 13pc of sales it has done this year have been to Indian buyers, up from 2.6pc in 2015/16.

Separate research by Cluttons found that between August 2016 and July 2017, Indian buyers accounted for 22pc of the sales in prime central London, made up of the City of Westminster and Kensington and Chelsea, up from 5pc in 2012.

This is partly due to changes in the Reserve Bank of India’s regulations of how much money can be taken out of the country. The so-called liberal remittance scheme was adjusted in 2015, meaning that a family of four can take out $1m, while previously it was only $400,000. Camilla Dell, managing partner at Black Brick, said: “It means that a family of four, after one year, will have $1m to spend, and after two years $2m. It quickly adds up, and explains why a lot of our Indian clients are buying in the £1m to £2m range.”

Property in central London is very attractive to foreign buyers as prices have been falling due to an oversupply of luxury flats and affordability issues. Prices of these luxury homes are 15pc lower than in September 2014, according to Savills. Coupled with the fall in sterling, some international buyers can buy homes for less than they could two years ago.


Black Brick’s Indian clients are split between investors, who largely want to buy new build flats in Shoreditch and White City, and owner-occupiers looking in Mayfair.


Becky Fatemi, managing director of estate agency Rokstone, agreed: “The most popular address for Indian buyers is Mayfair – where the most sought after addresses are Grosvenor Square, South Audley Street and Hill Street. The other alternatives for them are St James’s and Belgravia.” Ms Dell added that she is currently working with a Bollywood actress to buy a London home in Marylebone, Knightsbridge or Mayfair.

According to Black Brick, other big international buyers include those from the Middle East, France, Nigeria and Russia.

Monday, 4 December 2017

The £25k flat pack home


Ready made:the £25k home built in six hours IS too good to be true, but there are still benefits to pre-fab housing

The £25,000 home is not the cheap and quick fix it has been billed as, but pre-fab homes can still be the cheaper and quicker self-build option. Here's how to get started.




The £25,000 flat-pack home that can be constructed in just six hours has hit the headlines this week.


The impressive M.A.Di home, made in a factory, can be transported to virtually any location and built without the need for concrete foundations.


It even has the capacity to become “completely off-grid" with solar panels, LED lighting, and grey water systems.

It looks pretty chic, too. But Londoners hoping to make an affordable first step on to the housing ladder shouldn't splurge all their savings on a pre-fab home just yet.

BELOW MINIMUM SPACE REQUIREMENTS

Firstly, it only provides 27sq m of living space.

The minimum size for a single-storey new-build home in the UK is 37sq m; a two-storey home must be at least 58sq m.

This means UK buyers would have to buy the 84sq m version — which raises the price to just over £55,000. Secondly, the cheapest land listed for sale in London at the moment — a plot with planning permission for a two-bedroom house in Peckham — costs £324,999 on plotfinder.net.


While the location is ideal, with many first-time buyers now finding themselves priced out of Peckham, buying the land to put the house on brings the total cost to £375,000.


This is still cheaper than the £479,000 average first home in London. But the biggest barrier to buying a first home in the capital is finding the sizeable deposit required, and a hopeful buyer would need to find at least £55,000 for the modular home plus the deposit for the land.

"Obtaining a mortgage [would also be] unlikely as [M.A.Di homes] are classed as temporary structures," says Samantha Ferneley from Buildoffsite Property Assurance Scheme.

The good news is, thanks to stamp duty changes announced in the Autumn Budget, first-time buyers would only need to stump up £1,250 (as opposed to £6,250).

MODERN DAY MODULAR HOMES

Pre-fabricated homes, and extensions are slowly becoming more popular in the UK, for good reason.

"Pre-fabs have come a long way since the boxes of the 60s," says chief executive of HomeOwners Alliance, Paula Higgins.


"There are brilliant examples out there and opting for a pre-fab can be a good way to guarantee that you get the quality you want, because they are built in a highly controlled factory and assembled on site."


As such they have been touted as one answer to the housing crises, with the capability of closing the gap between supply and demand.

Winston Churchill initially gave the green light for prefab construction as a housing solution for families bombed during the Blitz.

The manufacturing technique peaked in 1968 when around 450,000 prefab homes were built in the UK contributing significantly to the capital’s post-war housing needs. Today only around 2,000 of the original pre-fab homes remain, having suffered from a reputation for poor quality.

Thanks to huge technological developments this reputation is changing fast and pre-fab elements are fast becoming a regular feature on Grand Designs-style builds.

Luxury hi-tech pre-fab homes promise to feature delivery drone landing pads, facial recognition technology to unlock the front door, robot vacuum cleaners and interactive bathroom mirror screens, as standard.

Most also have strong eco-friendly credentials, such as being built from sustainable materials and including rainwater collecting gutters, solar roofing and a car and house battery pack.

SECURING THE PLOT

The first, and crucial step, when opting for a modular home is purchasing land and being confident you will be able to get planning permission.

"It would be best to find land with planning permission attached to it, but this is scarce and comes at a big premium," says Higgins.

"Speak to the local council before purchasing your plot, to find out if there are restrictions. For instance, if it is in a conservation area you may need to build something that is in keeping with your neighbours and an ultra modern modular home is unlikely to do that."

One way to overcome the hurdle of finding land with the right permissions in place is to consider buying an existing (run-down) house and knocking it down.

The initial expense of this would hopefully be offset by the quick build times and the ongoing energy savings from living in a highly-efficient home.

https://www.homesandproperty.co.uk/property-news/the-25k-home-built-in-two-days-is-too-good-to-be-true-but-there-are-still-benefits-to-prefab-housing-a115821.html

Tuesday, 28 November 2017

Completed Professional HMO in Birmingham

This is the completed HMO that was purchased 3 months ago. It is an HMO's (Multilets) in a prime location in the Birmingham. This a Joint Venture with a local developer from Birmingham.
.
We will spend around £35,000 doing a major refurb, This will be a 8 person HMO for young professionals.

We will get around £3,000 per month rent. The costs will be around £1300 per month leaving a net profit of £1700 per month.

If you want to know more about the project or get involved in similar projects, please drop me a line on dav@mpinvestments.co.uk



Property unaffordable for 100,000 households a year in England

Almost 100,000 households in England are being priced out of the property market each year because of a shortage of affordable homes to rent or buy, according to a report.

Research by the estate agent Savills, shared with the Guardian, found the number of priced-out households had risen from its previous projection in 2015 of 70,000 a year. This was in part because of a change in how housing need is assessed, but also due to rising prices and stagnant wage growth.
On Wednesday, the chancellor, Philip Hammond, reiterated a pledge to build 300,000 homes a year by the mid-2020s and unveiled a package of measures to support housebuilding. Savills said one-third of those would need to be offered at below market prices to meet the growing need for affordable homes.


About 96,000 households are unable to afford homes at the market rate, either to buy or rent, Savills said, with the vast majority in London and the south. It said varying approaches were needed to address the shortfall in different parts of the country: low-cost rented homes were needed more in markets in which incomes were smaller, while a mixture of homes, including shared ownership, would help in more expensive areas.
In London, 20% of the households affected have incomes above £35,000, Savills said, while the same proportion earn less than £10,000.
Over the past three years, 55,000 fewer affordable homes have been built each year than were needed, the research found. Although 42,500 households in the capital required below market rate housing, only 8,800 affordable homes a year had been delivered. In the south outside London, 15,500 affordable homes a year were being built while 34,100 were needed.
Meanwhile, in the north of England, low incomes were locking out 9,600 households a year, with 8,900 homes being delivered. 
Although the post-budget headlines were dominated by Hammond’s decision to scrap stamp duty for the majority of first-time buyers, his announcement included more money for building and rule changes to help councils provide housing.
A speech by the prime minister, Theresa May, at the Conservative party conference in October made a commitment of £2bn over four years to fund social housing. However, to house 100,000 emerging households over this period would need funding of £7bn a year, Savills said.
Paying for the new homes would reduce the housing benefit bill by £430m a year.
Helen Collins, the head of housing consultancy at Savills, said the budget had offered many positives for the housing sector, but expressed some concerns.
“While the chancellor had plenty of good news, we feel there are still some important issues missing from housing policy,” she said.
These included no changes on building on greenbelt land and no additional funding for homes for social rent. “There was little reference to the importance of social rented homes as a better and cheaper alternative to the private rented sector for very low-income households,” Collins said.

https://www.theguardian.com/business/2017/nov/27/property-england-priced-out-households-affordable-homes-savills-report?utm_term=Autofeed&CMP=twt_b-gdnnews#link_time=1511746818

Monday, 27 November 2017

More maths for everyone, especially buy-to-let landlords


I’m not going to complain about this week’s Budget. It wasn’t imaginative, interesting or particularly funny and we won’t be able to look back on it in a decade as representing any kind of turning point in the miserable state of the UK’s public finances. But the chancellor did do something if which I approve. There will be, said Philip Hammond, “more maths for everyone”. His £177m plan to incentivise schools to work harder on numeracy includes some extra funding to push Singapore-style maths teaching into primary schools; a bung of £600 for schools for every additional pupil nudged into taking A-levels in maths, further maths or core maths; and a call for more applications for new specialist maths schools in England.

This is all excellent news. For years now, various groups in the UK have been lobbying heavily for cash for personal finance education in schools, on the basis that if kids understand how mortgages, savings accounts, credit card bills and basic investment products work, they will be more likely to be savers and less likely to be ripped off by the UK’s particularly rapacious financial industry. I’ve never been mad for the idea. There’s plenty of research to show that if people don’t need this kind of information immediately, it goes in one ear and straight out the other. No waiting around. So teaching schoolchildren about mortgages is a waste of everyone’s time — particularly when they will be 50 before they can afford one. It is better to produce “just in time” personal finance education as required (this is what the Pension Wise service is supposed to do for the over-50s, for example) and to teach children maths really, really well. This will give them the tools to help themselves financially as and when they need to, plus interpret the financial events happening around them.


NOVEMBER 24, 2017 Merryn Somerset Webb 43 comments I’m not going to complain about this week’s Budget. It wasn’t imaginative, interesting or particularly funny and we won’t be able to look back on it in a decade as representing any kind of turning point in the miserable state of the UK’s public finances. But the chancellor did do something if which I approve. There will be, said Philip Hammond, “more maths for everyone”. His £177m plan to incentivise schools to work harder on numeracy includes some extra funding to push Singapore-style maths teaching into primary schools; a bung of £600 for schools for every additional pupil nudged into taking A-levels in maths, further maths or core maths; and a call for more applications for new specialist maths schools in England. Essential stories related to this article Analysis UK Budget Budget 2017: FT experts look at what it means for you Merryn Somerset Webb Paradise Papers reveal a turning tide on tax avoidance Merryn Somerset Webb Interest rates rise — but it’s a steep road back to normality This is all excellent news. For years now, various groups in the UK have been lobbying heavily for cash for personal finance education in schools, on the basis that if kids understand how mortgages, savings accounts, credit card bills and basic investment products work, they will be more likely to be savers and less likely to be ripped off by the UK’s particularly rapacious financial industry. I’ve never been mad for the idea. There’s plenty of research to show that if people don’t need this kind of information immediately, it goes in one ear and straight out the other. No waiting around. So teaching schoolchildren about mortgages is a waste of everyone’s time — particularly when they will be 50 before they can afford one. It is better to produce “just in time” personal finance education as required (this is what the Pension Wise service is supposed to do for the over-50s, for example) and to teach children maths really, really well. This will give them the tools to help themselves financially as and when they need to, plus interpret the financial events happening around them. Listen: Key measures in the Autumn budget Play video With this in mind, let’s do a few quick sums on this week’s Budget — both to see how we might be affected immediately and to get a sense of the signals that Philip Hammond is sending us about the future. As you will see, a bit of maths can often tell us who the government regards as a plus or a minus. First, if a house is listed for sale at £300,000, how much more will it cost a buy-to-let investor to get his or her hands on the keys than a first-time buyer? The answer is simple. The first-time buyer pays £300,000 (his stamp duty has just been abolished). The buy-to-let investor pays £314,000 (his hasn’t been abolished, and he has to pay the additional 3 per cent second home surcharge on top). This gives you a sense of who the chancellor approves of and who he does not (or who he wants to approve of him, perhaps). But the next two sums well and truly make this point. If a buy-to-let investor bought a house for £200,000 in 2007 through a company structure (something lots of landlords are doing now to avoid the slashing of tax relief on mortgage interest) and sells it this year for £300,000, how much tax on the capital gain will he pay? The answer is not straightforward. Until now, assets bought inside a company have been eligible for indexation (your gains are adjusted for inflation) based on figures provided by HM Revenue & Customs. You take the number given by them that works for your timeframe — 0.313 in this case, according to tables on the HMRC website — and multiply it against the price you paid. Then take that sum (£62,600) away from your profit to get your taxable amount (£34,000). Finally, multiply that by 19 per cent (the corporation tax rate). The answer? £7,106. Hold that thought while you calculate the following. If a landlord bought a buy-to-let property now for the same £200,000 price and also sold it in a decade for £300,000 how much tax on the capital gain would they be likely to pay? The answer to this is easier. The gain multiplied by the tax rate — which is set to fall to 17 per cent. So £17,000, which is nearly £10,000 more than they would have paid on a similar investment gain a decade earlier. There you have it. A few sums that tell you the current government thinks buy-to-let isn’t all that. If you were thinking of becoming a landlord, maybe don’t. If you are already, maybe read the runes the way Mr Hammond wants you to and sell your rental property to your tenant (you’ll get good price — all the money they were saving for stamp duty can now be offered to you instead). There’s a useful sum available as a hint for those with houses that are “substantially unfurnished” and unused as well. You own a six-bedroom holiday home by the sea in Padstow that you are too busy to visit or furnish, what with the demands your international speaking schedule puts on you. How much has Philip Hammond probably just added to your cost of ownership? The answer to this is £3,371.02, the level of Band H council tax in Padstow — which can now be doubled for empty homes. It couldn’t be much clearer could it? In Mr Hammond’s world, houses are for owners to live in full time and that’s that. Something to bear in mind if you are still convinced that you can’t go wrong with property. There are many more fun numbers to play around with in the Budget. No doubt FT columnist-turned maths teacher Lucy Kellaway is already planning her next lesson around them. Send us in your best Budget-related sums and we’ll pass them on to her with a small prize for the one we like the best. Given the gloomy economic backdrop, it’s also worth noting that a good understanding of maths is helpful in another way — it can alert us to the bits of the Budget that pretend to be about real numbers, but are nothing of the sort. With this in mind, if the Office for Budget Responsibility forecasts that UK GDP will grow at a rate of 1.3 per cent in 2020, what rate will GDP actually be growing at in 2020? The answer is maybe a lot more than 1.3 per cent, or maybe rather less. But almost certainly not 1.3 per cent. Like all forecasters, the OBR has an almost unblemished history of wrongness. There is no mathematical formula that can take into account what will happen to inflation, oil prices, immigration, productivity, technology and that most fickle of all things, human behaviour, over a six-month period, let alone a three-year one. Better to ignore these numbers and focus on the ones you know will impact you, and you know you can calculate correctly — after your Singapore-style maths class, at least.
https://www.ft.com/content/c6413d14-d06a-11e7-9dbb-291a884dd8c6

Friday, 24 November 2017

The Autumn Budget 2017 statement – what this means for the housing market

The long-awaited Autumn Budget was announced by Chancellor Philip Hammond today outlining a number of key points affecting the housing market.
After Sajid Javid, Secretary of State for Communities and Local Government addressed mounting concerns over what he called ‘the broken housing market’the budget was eagerly anticipated.
Points include Stamp Duty being permanently abolished for first-time buyers purchasing properties up to £300,000 effective immediately. To help first-time buyers in London and other expensive regions, the first £300,000 of the cost of a £500,000 purchase by all first-time buyers will be exempt from stamp duty.
This will benefit 95% of all first-time buyers, with 80% not paying any stamp duty.

It was also announced that local authorities will now have the power to charge a 100% council tax premium on empty properties.
The Chancellor also announced that a consultation will be launched on barriers to longer tenancies and how the government might encourage landlords to offer them to those tenants who want additional security. This is perhaps the most relevant point for the private rented sector.
Eddie Hooker, CEO of mydeposits says: “It goes without saying that we welcome the consultation on longer tenancies and we will be very interested to see what these barriers to longer tenancies are. As providers of tenancy deposit protection, our data suggests that tenancies are lengthening. Our members seek happy tenants who pay their rent on time, keep the property in good condition and want to live in the property long-term.”
Over the next five years, the government will commit £44 billion of capital funding, loans and guarantee to support the housing marketing.  This is somewhat lower than the £50 billion requested by the Sajid Javid to tackle the housing shortage, but will still make a significant contribution. This funding will help to deliver 300,000 new homes on average each year by the mid-2020s. A further £2.7 billion will also be invested which will more than double the Housing Infrastructure Fund.
Other announcements include the government investing £28m in three new “Housing First” pilots in the West Midlands, Manchester and Liverpool in response to homelessness in a bid to halve rough sleeping by 2022 and eliminate it by 2027.
An interim report will be released in time for the Spring Statement next year to understand why there is a significant gap between planning permissions and the number of homes being built.

Thursday, 23 November 2017

Key points from budget 2017 – at a glance

The chancellor, Philip Hammond, has unveiled the budget. These are the main points, with political analysis

  • Autumn budget 2017: reaction and analysis – live
  • Stamp duty

    Rowena Mason, deputy political editor: This will please many looking to buy their first home. But it is hard to see how it will increase supply. It is likely to help those in the south-east the most, and may just stimulate the slowing market again.

    Housing

    • 100% council tax premium on empty properties.
    • £28m in three new housing pilot schemes – in the West Midlands, Manchester and Liverpool – to halve rough sleeping by 2022 and eliminate it by 2027.
    • £44bn of capital funding to help build 300,000 homes annually by mid-2020s.
    • New money for homebuilders fund.
    • £630m ‘small sites fund’.
    • £8bn of financial guarantees to support private housebuilding.
    • £2.7bn housing infrastructure fund.
    • £1.1bn for new urban regeneration.
    • £34m to train construction workers.
    • A review to be chaired by Oliver Letwin to look at ways to speed up planning permission.
    • Five new garden towns.
    • One million new homes on the Cambridge-Milton Keynes-Oxford corridor by 2050.
    RM: Hammond’s package goes further than what he promised over the weekend, pledging £44bn in capital funding to help meet his pledge of 300,000 homes annually by 2020. He is also issuing a threat to developers that their days of landbanking are over, as he hit out at those who do not build on plots that have already been granted planning permission. The chancellor only promises a review but does not rule out direct action.

    Rent

    • £125m of funding over the next two years to help 140,000 people.
    RM: This is only a small package for renters compared with the billions being spent on encouraging housebuilding. It is targeted at those on low incomes and receiving housing benefit in areas where rents are rising the most, thereby handing more money to landlords.

    Universal credit

    • £1.5bn to remove seven-day waiting period; new claimants in receipt of housing benefit will get it for two weeks.
    RM: This is a partial victory for those campaigning against the injustices of the universal credit system leaving many in hardship. It is an expensive move – reducing the waiting time of claimants by one week, make advances quicker and give people housing benefit for longer to avoid the threat of evictions while they wait for universal credit. Tory MPs are likely to be appeased but Labour may well think this does not go far enough, considering many claimants have been left waiting for six weeks for their first payments.

    Brexit

    • £3bn set aside for Brexit preparations.
    RM: This is a big boost to the £700m previously allocated for preparations. It will be seen as a victory for those hard Brexiters pushing for more money to get ready for the possibility of leaving the EU with no deal. But critics of Brexit are likely to seize on the large sum, which could otherwise have been spent on improving public services. Voters were also promised that leaving the EU would save them money, not cost more.

    Economic growth

    •  Revised down to 1.5% in 2017 from 2%.
    • Forecasts are 1.4% in 2018, 1.3% in 2019, 1.3% in 2020, 1.5% in 2021 and 1.6% in 2022.
    • In March the forecasts were 1.6% in 2018, 1.7% in 2019, 1.9% in 2020 and 2% in 2021.
    RM: It is nearly all bad news on the economic front. Growth is lower than expected and productivity still poor. Hammond does not say why the economy will slow for the next three years but there will be inevitable links to the uncertainty caused by Brexit.

    Government borrowing

    • £49.9bn this year, down by £8.4bn from the previous forecast.
    • Down from £39.5bn next year to £25.6bn in 2022-23.
    RM: Hammond says he is not resiling from efforts to bring down the UK’s deficit and debt, as he still wants to balance the books like George Osborne. But he is slowing the pace of reducing the deficit so borrowing will reduce less rapidly than forecast in March.

    NHS

    • £10bn capital investment in frontline services over the course of this parliament.
    • £2.8bn of extra funding for England.
    RM: The chancellor is giving an extra £2.8bn to the NHS – which falls short of the £4bn demanded by Simon Stevens, the chief executive of NHS England. As expected, Hammond commits to £10bn on capital expenditure in the health service.

    Living wage

    • Up to £7.83 an hour, from £7.50.
    RM: The Conservatives say this will give the lowest-paid workers a rise of about £600 a year but it is still below the real living wage of £8.75 and Labour’s promise to raise it to £10.

    Income tax

    • Basic rate rises to £11,850 from April; 40% threshold increases to £46,350.
    • Chancellor has previously pledged to increase basic rate to £12,500 by 2020.
    RM: The rise in the basic rate income tax threshold is in line with the Conservatives’ pledge to increase it to £12,500 by 2020 and the higher rate threshold – the point at which you start paying 40% tax – to £50,000 by 2020.

    Electric cars

    • £400m for charging infrastructure fund.
    • Those charging electric vehicles at work will not face taxes.
    RM: The chancellor seems very keen on boosting new technologies, although quite a niche one as electric cars are driven by a minority of people at the moment.

    Diesel cars

    • 1 percentage point increase in company car tax.
    • From 2018, an increase in tax on cars that don’t meet standards – to go up by one band.
    • Proceeds to fund £220m clean air fund.
    RM: Hammond promises that he is not hammering white van man or woman, mindful of how his budget will be received by headline writers at the Sun. The increase in vehicle tax also only applies to new diesel cars from 1 April, so existing owners who were encouraged to buy diesel by previous governments will avoid being penalised.

    Education

    • Maths: £40m for maths teachers; £600 premium for schools for each student taking A-level maths.
    • Computing: triple number of science teachers to 12,000; new national centre for computing.
    • National retraining scheme for digital expertise.
    RM: This announcement is covered in the fingerprints of Hammond’s deputy, Liz Truss, who has long spoken about the need to focus on maths, science and the quality of teaching.

    Northern powerhouse

    • £1.7bn transforming cities fund.
    RM: It seems May’s government has not abandoned Osborne’s northern powerhouse after all. The announcement is about better connecting prosperous city centres with their suburbs.

    Scotland, Wales and Northern Ireland

    • £650m extra for Northern Ireland.
    • £2bn extra for Scotland.
    • £1.2bn extra for Wales.
    RM: This is not too much to get excited about, as it is just the consequences of the Barnett formula being applied to this budget. The only new bit specific to Scotland is that the government will legislate to allow Scottish police and fire services VAT refunds from April 2018.

    Oil

    • Tax changes to encourage investment; ‘Transferable Tax History’ for oil and gas fields in the North Sea.
    RM: This is a straightforward tax break for North Sea oil producers, slightly undermining the chancellor’s earlier green rhetoric about electric cars and taxing plastics.

    Duties on spirits, wine and beer

    • Frozen.
    • A new tax band for still cider and perry with alcohol content between 6.9%-7.5% to target white cider.
    RM: This one got a huge cheer from the backbenches. ‘Happy Christmas, Mr Deputy Speaker,’ Hammond adds.

    New railcard

    • 4.5 million people aged 26-30 to get a third off rail fares.
    RM: Hammond has been under pressure to appeal to younger voters after they turned to Labour in their droves at the election. However, some have questioned whether such an obvious handout will tempt those in their 20s back to the Conservatives and highlighted the risk that it could annoy those in their 30s who also turned to Labour.

    Airlines

    • Increase on air passenger duty on premium-class tickets.
    RM: The chancellor turns to wealthier first-class passengers and those who travel by private jet to fund a freeze in air passenger duty, which airline bosses have long been complaining makes them uncompetitive.

    Grenfell Tower

    • £28m for mental health services and local regeneration for Kensington and Chelsea council.

    Fuel duty rise

    • Cancelled.
    RM: Every year Conservative MPs lobby against further rises in fuel duty and this year the chancellor has given in once again – at a time of rising petrol and diesel prices.

    Tax avoidance

    • Measures to raise £4.8bn by 2022-23.
    RM: It is the most predictable element of any budget: pledges by the chancellor to raise money from cracking down on tax avoidance.

    Business rates

    • £2.3bn cost to bring forward the change to Consumer Prices Index from Retail Prices Index by two years to 2018.
    • After next revaluation, future revaluations to take place every three years rather than five.
    • Staircase tax: businesses hit will have original bill reinstated.
    • Discount for pubs (rateable value less than £100,000) extended by one year to March 2019.

    VAT

    • Consultation on threshold of £85,000 at which small businesses pay VAT.
    RM: Hammond shies away from the controversial move of lowering the threshold at which businesses start having to charge VAT, which would no doubt have been characterised as a tax on small tradesmen and women. Instead, he goes for the old trick of launching a consultation on the difficult issue.

    Digital tax

    • £200m a year extra from income tax on UK sales.
    • Target £1.2bn a year in lost VAT from online shopping.
    RM: This is an attempt to raise money from digital retailers to level the playing field between them and high street shops, but the £200m revenue is not huge.

    Research and development

    • £2.3bn of investment.
    • Increase tax credit to 12%.
    • £500m for artificial intelligence and 5G initiatives.
    RM: The chancellor is focusing on scientific investment as he tries to pitch this as a ‘forward-looking’ budget. It involves tax breaks for spending on research, even though these have been criticised by the IPPR thinktank for subsidising investment that would have happened anyway.
    • Investigate charges on plastic waste.
    RM: This is a potential revenue raiser for the Treasury, after a string of media stories about the wastefulness of items such as coffee cups, plastic bags, food wrappers, straws and drinks bottles. This is only a consultation though, so could take a while to flow through.

  • £20bn of new investment in UK knowledge-intensive industries.
  • £2.5bn for the British Business Bank.
  • Encourage pension fund investment.
  • Boost to Enterprise Investment Scheme.
  • Replace funding from Europe.

Why the young should watch the Budget

More young people are voting than at any time in the last quarter of a century.
But that resurgence is favouring the Labour Party.
Just two years ago, the split in support between Labour and the Conservatives among 18 to 29-year-olds was fairly even, 36% to 32%.
But in June's general election that gap widened dramatically, with Labour taking a 64% share to the Tories' 21%, according to pollsters YouGov.
So with the Budget coming up on 22 November, where could the Chancellor take action to attract the younger voter?

Housing

The number of young people living at home has been rising.
In 1996, around 2.7 million, or 21%, of those aged between 20 and 34 were living at home. That figure has risen to 3.4 million or 26% in 2017, according to the Office for National Statistics.
Average UK house price
For young men the proportion is even higher, at 32%.
That rise is partly due to more young people staying in education and training, but also due to the increased costs of buying or renting a home.
In October, Prime Minister Theresa May promised to fix the "broken" housing market and earmarked another £2bn to build council houses and affordable homes for rent.
But Labour and housing charities said the plan would only help a fraction of the 1.2 million families awaiting housing.
Percentage of income spent on housing costs

Pay

For decades after World War Two young people could expect to be better off than their parents at comparable ages.
But some data shows recent generations have been doing worse than their predecessors.
If you look at the chart below, the age at which Baby Boomers and Generation X, started earning £400 per week consistently fell. But for millennials that age started to rise.
Age at which each generation earned £400 per week
However, more recent data shows that pay for younger people has been holding up well over the past 10 years. Younger generations have seen pay growth that is roughly comparable to older workers, according to data from the Office for National Statistics. Pay for younger workers has been supported by rises in minimum wage.

Education

It's not all grim news for today's young people. They are going on to higher education in greater numbers than previous generations.
In 1950, just 3.4% of the population had been to university.
Students obtaining university degrees
As the chart above indicates, there has been a dramatic rise in higher education participation since then.
In England, the higher education participation rate for 17-20 year olds rose to 42% in 2016, from 33% in 2006.
However, there are questions over whether there is demand for those graduates.
The Chartered Institute for Personnel and Development (CIPD) estimates that for those who left in the 2015 university year, 48% ended up in non-graduate jobs six months on.
But at least the jobs market is strong. The unemployment rate has fallen to 4.3%, the lowest in 42 years.
Chart showing improving prospects in teh jobs market

Debt

But that higher education comes at a cost. Tuition fees were first introduced in 1998 and since then have risen to more than £9,000 in England. In Scotland young people do not pay university tuition fees.
If you include that student debt, then young people have very high levels of unsecured debt.
Bar chart showing unsecured debt as a ratio of income by age group
The chart above is based on recent survey data analysed by PWC. It found that on average 25 to 34-year-olds hold debt equivalent to more than 50% of their income.
Of course you could argue that student loans are not as onerous as other forms of debt, as it is only paid back once the student gets a job earning more than £21,000 a year.
Nevertheless it has a financial burden that previous generations have not had to carry.
In October, the government announced that tuition fees in England would be frozen at £9,250 a year. It will also raise the earnings threshold at which graduates have to start paying tax to £25,000 in April 2018.