RICS responds to 2025 UK Spring Statement

The Chancellor today delivered her Spring Statement, building on the Autumn Budget and reaffirming her commitment to one annual fiscal event.  The context offered for today’s statement was one of growing macroeconomic uncertainty and rising debt servicing costs. 

Ahead of the Spring Statement, RICS called on the Chancellor to stimulate economic growth by:

• Improving the home buying and selling process to stimulate the housing market, support consumer confidence and generate much-needed stamp duty revenue.
• Committing to deliver meaningful reform to business rates to which creates a level-playing field for businesses.
• Bridging the skills gap by investing in built environment education, green skills and AI.

RICS welcomes the measures announced by the Chancellor to help deliver the Government’s commitment to build 1.5 million homes in England by the end of the Parliament.  These announcements build on changes to the National Planning Policy Framework, and the Chancellor forecast that housebuilding would rise to a rate of 305,000 per year which will help address the imbalance in the housing market.  For social landlords, RICS ongoing work to develop the Stock Condition Survey will provide landlords with the information that they need to help ensure that all social housing residents are living in good quality homes.

The inclusion of grey belt development and mandatory housing targets further underpin the drive to grow housing supply.  In order to deliver the maximum value of these planning reforms, RICS would encourage government to explore the integration of ADR mechanisms into Section 106 agreements which would help prevent unnecessary delays and streamline planning approvals.

In future fiscal events, RICS would like to see improvements to the home buying and selling process with sellers having a condition survey available at the point of listing and the realignment of VAT on preservation works to new build dwellings.

Commenting on the Spring Statement, Justin Young, RICS CEO said:

“We are glad the Chancellor has announced a number of measures RICS have been advocating for to support housebuilding, skills development and businesses.

“The announcement by the government of an additional £2 billion investment to build 18,000 new social homes is an enormous boost for the sector. Alongside ongoing reforms to planning, this should provide increased confidence for housebuilders across the country. According to RICS data, the gap between housing demand and supply continues to widen, so these new social homes will prove vital for supporting new supply and crucially housing the most vulnerable.

 “The £600 million of additional funding for construction sector skills is a decisive investment in the UK’s built environment. This should help secure the next generation of construction sector workers and professionals as we look to tackle the challenge of an aging workforce alongside acute labour and skills shortages. If this can be combined with a new GCSE for the Built Environment in England, we can drive fresh talent to take up the new opportunities afforded by this investment.

"We are pleased the government will publish plans for much needed business rates reform later this year - hopefully creating a fairer system for businesses as they face increasing financial pressure.

“Given that the country currently faces deep economic challenges, these measures are certainly positive news for the built environment. While this isn’t everything on our list of asks, this is certainly a step forward. We look forward to it and continuing our conversation with the government as it seeks to transform the built environment.”

Tarrant Parsons, RICS Head of Market Analytics, said:

“Much has changed since Chancellor Rachel Reeves outlined her plans for fiscal policy five months ago, with domestic economic growth losing momentum of late alongside resurfacing concerns over inflation. Adding to the difficulties for the UK government, the external environment has turned increasingly challenging, as uncertainty around trade tariffs and deteriorating business confidence  hinders the outlook. Reflecting this, the OBR’s latest forecasts include a significant downgrade to GDP growth during 2025, with expectations cut to just 1%.

“Despite the near-term weakness, the OBR’s forecasts are more optimistic looking further ahead.  In terms of government’s financial position, public sector net borrowing is projected to fall from £137.3 billion in 2025 to £74 billion in 2029-30. For context, as a result of higher debt interest payments and weaker near-term growth, expected borrowing in the current year is £12.1 billion higher than projected in the Autumn Statement. 

“Perhaps the standout highlight from today’s updated OBR forecasts relates to future housing supply. In the 2025/26 fiscal year, the OBR envisages net additions to the UK housing stock falling to just 192k (down from 265k in 2023/24).  This would mark a 12-year low in net additional dwellings. From that point forward, however, the OBR projects a remarkable turnaround, with 1.3million homes being added through to 2029-30 and close to 305k coming in the final year of the forecast alone. The OBR sees the Government’s reforms to the National Planning Policy Framework as key to this increase, estimated to contribute to an additional 170,000 homes being added across the forecast period.”