The Autumn Budget wasn’t expected to throw up too many surprises in terms of housing – they were reserved for the summer budget, and the proposals which led many landlords to question whether they would even be profitable by 2020. However, all followers of the industry market were shocked to hear of a new 3pc surcharge on second homes for buy-to-let investors, due to be enforced in April 2016. The bulk of media attention has focused on this change, but here is a quick reminder of what else came out in the budget. The Chancellor claimed that sorting the housing crisis was a big priority of his. Announcements included: New Homes George Osborne wants 400,000 affordable houses to become available by the end of the current government in 2020. He will specifically target starter homes for first time buyers, therefore starting the property chain nationwide. The starter home fund will be £2.3bn of a total £9.6bn investment in housing initiatives. Help to Buy Shared Ownership Scheme 135,000 homes will be made available for part-ownership. In practise, this means low earning households (£80,000pa or less) will be eligible to buy a share of a house from a housing association or local council, then gradually increase their share over time until they own the property outright. In the time where the household has an incomplete stake in the property, rent will be limited to 3pc of the value of the house that has not been paid for by the household. For example. A house is worth £250,000. The household has gradually upped their ownership of the property to 50pc. They are therefore paying 3pc rent on the remaining £125,000, which is £312pcm. However, it is worth noting that house prices are rising so an increase in price will result in an increase in rent. Also, households that sell up before reaching full ownership will be unlikely to receive the market value of the property. Help to Buy London Help to Buy is being significantly changed. At the time of the announcement, buyers who had a 5pc deposit available were eligible for a loan of 20pc of the value of the home. That 20pc is now being extended to 40pc, interest free, for five years. The changes recognise the difficulty with entering the London housing market, especially in comparison with other areas in the UK. Help to Buy has resulted in a 60pc increase in first-time buyers across the UK, but with very little impact in London. This change will persuade young buyers that living in London will be a sustainable lifestyle choice. Other benefits The government is making a concerted effort to bridge the North-South divide, and landlords will benefit from expanding their portfolios in the North thanks to the extensive redevelopment in the Northern Powerhouse sector. Therefore, landlords who are worried about low yields or insufficient wage growth can take solace that other regions in the UK will become more and more feasible in the coming years, especially if they find investors who are looking to sell their entire portfolios. Many accidental landlords are likely to leave the industry to avoid the gradually increasing tax relief changes, and they will be replaced by professional landlords. This means that the pool of landlords will become smaller, and cause a calming of buy-to-let property prices. If you have any queries about how to protect or expand your portfolio, please contact your local Ellis & Co office today.