Results from Crowe Clark Whitehill’s annual Property and Construction Outlook Report provide a 12-month insight into the industry’s attitudes.
Just under half of UK based property and construction businesses believe the 2016 EU referendum and vote for Brexit will have a negative effect on the industry, with a further 44% unsure as to whether it will bring any benefits, according to a survey conducted by national audit, tax and advisory firm, Crowe Clark Whitehill.
Additionally, 77% believe this year’s general election was unfavourable to the property and construction market and the clock is now ticking for the UK government to restore confidence and reassure the industry before the UK formally leaves the EU in March 2019.
More than 70% of participants believe that the current UK tax system is unfavourable to the industry, with 55% viewing Stamp Duty Land Tax (SDLT) as the biggest barrier to business growth and another 17% perceiving a 45% income tax rate as the biggest deterrent to investment.
Support for the property and construction market and local authorities must be high on the government’s priorities over the upcoming year. Indeed, three quarters of respondents highlighted that the current green belt protections were not conducive to solving the housing crisis.
Commenting on the findings, Stacy Eden, Head of Property and Construction at Crowe states:
“Some of the uncertainty that currently pervades the industry revolves around what deal the UK government eventually agrees with Brussels. For those in the construction industry, there remain real concerns over the potential barriers to free movement – this has the potential to increase labour costs and reduce the scope of operations due to the potential lack of skilled labour.
“The recent increases in stamp duty have resulted, as widely predicted, in a considerable slowdown in the market. While recent stats show that stamp duty receipts have risen, this should not cloud the reality of what is going on in the market. The negative SDLT levy remains a substantial burden and a drag on sector growth. Reducing this burden should be the government’s first step to encouraging much needed investment and liquidity in the market.
“Building on greenbelt land is possibly the only chance councils have for hitting a target of up to 300,000 new homes a year that is arguably needed to solve the housing crisis.”