RACHEL Reeves has confirmed her plan to build 1.5 million new homes in her Spring Statement presser.
The Chancellor said house-building will hit a 40-year high by 2030 in a relief for Britain's broken property market.
The Office for Budget Responsibility yesterday predicted 1.3 million newhomeswill be completed by the end of the decade.
A push by ministers to slash planning permission red tape will see property sales increase from 290,000 per quarter in late 2024 to 370,000 by 2029.
The spike in transactions will add £6.8n to GDP.
But in bad news for aspiring homeowners, the watchdog revealed average prices will soar from £265,000 late this year to £295,000 by the end of the decade.
And mortgage rates are expected to rise from 3.7 per cent in 2024 to a peak of 4.7 per cent in 2028.
A fresh £2bn cash injection will also help Britain build up to 18,000 social and affordable homes.
Ms Reeves confirmed new funding to support residential developments set for competition by 2029.
Thousands of affordable homes will begin construction by March 2027, with ministers encouraging building firms to step forward with bids to ramp up housing supply.
Manchester and Liverpool will be among the areas targeted by Ms Reeves to increase the number of homes.
The Chancellor said while announcing the scheme this week: “We are fixing the housing crisis in this country with the biggest boost in social and affordable housebuilding in a generation.
“Today’s announcement will help drive growth through our Plan for Change by delivering up to 18,000 new homes, as well as jobs and opportunities, getting more money into working people's pockets.”;
What is the Spring Statement?
By Ryan Sabey, Deputy Political Editor
Rachel Reeves is delivering the Spring Statement – nearly fifty years after the first such “mini-Budget”; was delivered.
The statement, which over the years has been delivered in both autumn and Spring, was started in 1976 at the end of the year.
The law changed in 1975 to ensure there were two economic forecasts every year as opposition MPs and the public could keep track of government plans.
Rachel Reeves has insisted there will only be one major fiscal event each year with a Budget planned for the autumn – so no tax hikes or reductions this year.
Her Labour predecessor Gordon Brown held the Budget in the the autumn and each autumn he would deliver a Pre-Budget Report giving an update on the state of the country’s finances.
Fast forward to 2010 and George Osborne, Chancellor until 2016, set up the Office for Budget Responsibility, to provide an independent forecast.
They were also there to dissect the state of the economy – producing five-year forecasts twice a year.
But the OBR weren’t asked for a forecast by short-lived Prime Minister Liz Truss in 2022 despite their mini-Budget containing an array of tax cuts causing a market meltdown.
Housing Secretary Angela Rayner added: “Everyone deserves to have a safe and secure roof over their heads and a place to call their own, but the reality is that far too many people have been frozen out of homeownership or denied the chance to rent a home they can afford thanks to the housing crisis we’ve inherited.
“This investment will help us to build thousands more affordable homes to buy and rent and get working people and families into secure homes and onto the housing ladder.”;
Ms Reeves is swinging the axe at Whitehall spending in a desperate bid to balance the books at the Spring Statement.
With government borrowing higher than predicted and growth expected to plummet, she has told the country that her headroom of around £10 billion from last year has been wiped out.
The Chancellor hasn't announced changes to taxes in the Spring Statement, but is cutting tens of thousands of civil service jobs.
On Monday leading economist Paul Johnson warned that taxes are at the highest level they have ever been.
The Director of the Institute for Fiscal Studies claimed there had been a “historically extraordinary increase”; in levies, with no signs of slowing down for the remainder of the decade.
Sir Keir Starmer and the Chancellor have refused to rule out more brutal tax hikes in the next Autumn Budget.
Mr Johnson told the BBC: “I think the key fact is if you want serious money you have to do broadly speaking what the Chancellor did back in October – you have to raise one of the big taxes, and she decided to raise National Insurance.
“I think it is really important to be clear for those who are asking for increased taxes – this is the biggest period of raising taxes we have ever had, or at least we have had since the Second World War.
“They are rising by an extraordinary amount over this decade.”;
What does this Spring Statement mean for Rachel Reeves?
By Ryan Sabey, Deputy Political Editor
RACHEL Reeves is trying to shift any blame away from herself and the Labour government as it grapples with the sluggish economy.
The Chancellor is telling MPs that the “world had changed”; meaning she has to take drastic action when it comes to spending and welfare.
The trouble for Ms Reeves and Sir Keir Starmer is that they put growth as their “number one”; mission and that, to put it mildly, is stalling.
The independent watchdog say growth forecasts has halved for this year and the financial headroom wiped out – hence the savings to be made elsewhere.
But for Ms Reeves all this puts her in a very tight spot insisting she will stick to her iron clad rules – with her looking to find up to £15 billion of savings.
The Tories and commentators are aiming their fire over how she hasn’t helped herself as growth has fallen.
They point out that she was the person who decided to go on a £40 billion tax raid at October’s Budget – with £25 billion of it falling on the shoulders of business.
The upcoming Donald Trump-led tariff war ledcould easily throw the government off course again unless a limited trade deal can be struck.
Rachel Reeves will be pushing every leaver possible to get that over the line before it kicks in next week to give her some breathing space.
But we could be back at square one come the autumn with the Budget to balance the books – with speculation there could be tax rises and Whitehall departments scratching around for more savings.
