The Chancellor's summer statement sets out a plan to boost jobs in the UK economy post-pandemic - and here are three key takeaways for estate and letting agents to consider.
The Chancellor’s summer statement, ‘A Plan for Jobs 2020', comes as nearly all restrictions from the lockdown have been lifted, and moves us into the “second phase of our economic response” to the pandemic.
The lettings sector has already seen a strong uptick in business since house moves were allowed again in March - and the government's measures raise new opportunities for you and your landlords.
Here are three key points from the statement and the subsequent policy paper for you to consider.
Temporary stamp duty cut
From 8 July 2020, anyone purchasing a property in England and Northern Ireland will find that the threshold for paying Stamp Duty Land Tax (SDLT) has temporarily increased from £125,000 to apply to properties of £500,000 or more, on deals finalised before 31 March 2021. The government estimates that “nearly nine out of ten people buying a main home this year will pay no stamp duty at all.”
Landlords purchasing buy-to-let properties in England and Northern Ireland can benefit from this temporary change but will still pay the 3% surcharge on properties costing up to £500,000. The potential cost saving from the stamp duty cut may prove tempting for landlords considering entering the rental market, or expanding their portfolio - an influx at just the right time to meet the current strong demand in the rental market.
Vouchers for energy-saving measures
The government is doubling down on its pledge to cut greenhouse gas emissions to net zero by 2050, with an investment of £2bn in England into the “Green Homes Grant”. The government will provide "at least £2 for every £1 homeowners and landlords spend to make their homes more energy efficient, up to £5,000 per household." Applications are set to open from September.
This is a win-win-win for your landlords. Not only will they be able to make improvements for a lower cost, they’ll attract more climate-conscious tenants and save money in the long run with their energy efficient properties - the government aims for this measure to upgrade over 600,000 homes across England, so households can save “hundreds of pounds per year on their energy bills.”
Hiring opportunities
Although the government has confirmed that the furlough scheme will end in October, it’s announced a Job Retention Bonus, where they'll introduce a "one-off payment of £1,000 to UK employers for every furloughed employee who remains continuously employed through to the end of January 2021."
And, with lettings picking up as we head into the busy summer months, the prospect of hiring some helping hands may have its appeal.
They've also created a package of measures to encourage employers to hire from the under-25 age group, as they are “two and a half times as likely to work in a sector that has been closed.” These measures include:
The Kickstart Scheme
The government will invest £2bn to subsidise high quality six-month work placements in Great Britain for young adults between 16 and 24 years old on Universal Credit, who are at risk of long-term unemployment. The funding will hinge on the kickstarters being employed in new jobs and it will cover "100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions." The scheme aims to open from next month, with new jobs starting in the autumn.
Apprenticeships
For those who hire new apprentices from 1 August 2020 to 31 January 2021, the government will pay employers in England £2,000 for each new apprentice aged under 25 and £1,500 for each new apprentice aged 25 or over that the business hires.
With either option, you can be safe in the knowledge that you’re helping to boost the economy - and to train younger employees to meet the standards of the modern agent of today.
This blog was updated to reflect the “A Plan for Jobs 2020” policy paper, including a clarification on the Green Grant Scheme, apprenticeship payments, and the 3% landlord charge. It is intended as a guide only. It is not exhaustive and doesn't constitute legal advice. See gov.uk more information.
