The Spring Budget needs to inject energy into the new build market to boost the Construction sector.

The most important thing the Chancellor can do for the construction industry is to focus on sustaining the new build market.

We still don’t have enough housing and the new build market looks to be quieter this year than in 2022. This is a problem because new builds are of higher specifications and boast greater energy efficiency.

Despite strong results from the latest construction PMI as a whole, house building is not currently that strong in many regions and we could be on the cusp of a market downturn. The way to inject more energy into the new build market is to keep some form of economic stimulus running, such as mortgage relief for first time buyers for the first 5 years of ownership. This would incentivise house builders, create economic activity and stimulate the housing market generally.

Corporation Tax increasing to 25% is unhelpful but it is only on profits. Fewer housing starts means less profit, therefore less tax. The country would be better served with more housing, increased revenues from Stamp Duty, and higher corporate profits with tax at 19%.

If the chancellor wants to raise rates to 25%, he has got to look to give incentives for capital investment otherwise companies will sit on their hands.

An annual tax on second homes remains a good idea. It would help the Treasury and doesn’t affect the man or women in the street. Why second homes and not buy to let or furnished holiday accommodation? Both of the latter have people living in them at most times of the year who will spend money in the local community, while second homes stand empty most of the time.

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