Leaders from the UK’s real estate and property finance sector share their thoughts on the government’s Spring Statement and the announcement of an unexpected fall in the headline rate of inflation in February.
As many anticipated, the Spring Statement was light on substance, aside from the OBR forecasts, government running costs and welfare reforms.
Paresh Raja, CEO of Market Financial Solutions, says: “Overturning outdated parts of government to improve efficiency has been a major focus for Labour since the election, and planning reform was raised again as a key part of this agenda. However, the “get Britain building” rhetoric must now translate into tangible action – bringing in new construction workers is a positive step, as the Chancellor had already announced three days ago, but much of today’s speech involved repeating the Autumn Budget’s plans to encourage housebuilding.
“Reforming the planning system is obviously important. However, investors and developers are unlikely to commit to new projects unless they see a strong and growing economy that provides long-term confidence and a return on their investment. The OBR forecasts were a blow in this regard, and the onus must now be on turning the corner to turbo-charge GDP growth.
“House prices are rising, inflation fell in February, and the base rate is expected to come down further this year. These are all positives, highlighting that the property market remains bouyant, and this is important given how significant the sector’s contribution to GDP is. In future statements and budgets, we need the Chancellor to focus more energy on supporting homebuyers and borrowers, which will further stimulate growth in the market.”
Tim Parkes, CEO of RAW Capital Partners, says: “It might not have the standing of the Autumn Budget, but the Spring Statement was an opportunity for the government to set out a bold vision for growth nonetheless. However, today’s speech highlighted that there remains a keen focus on fixing legacy issues, both with the state of the economic and within the property sector, most notably where housebuilding is concerned. This is, of course, important. But the UK also needs a more proactive and forward-thinking strategy to meaningfully encourage economic growth.
“Creating the right conditions for investment should therefore be the government’s top priority if it hopes to attract both domestic and international capital. This means not just stabilising the economy and filling the fiscal blackhole, but fostering an environment where businesses and investors feel confident to commit to the UK for the long term.
“But the government can’t do it all on its own, so specialist lenders have a key role to play in facilitating overseas investment into UK property and contributing to a growing economy. By offering a tailored approach to lending and bespoke financial products, they can help international investors navigate the market with greater confidence, while reinforcing the UK’s position as a prime destination for investment.”
Timothy Douglas, Head of Policy and Campaigns for Propertymark, says: “The Spring Statement had a clear focus on the vital role housing plays in the UK economy and as part of the UK Government’s plan for growth, so it is encouraging to hear that planning reforms will boost national income. However, workforce challenges remain and it’s vital that local councils have the resources required to deliver effective planning and infrastructure so communities up and down the country and the wider economy really benefit.”
Hamish Martin, Partner at LAVA Advisory Partners, says: “The Chancellor was true to her word that today’s announcement would be more of an economic update than delivering a raft of tax reforms or spending commitments. For businesses, hopes of u-turns on previously-announced policies such as National Insurance hikes did not materialise, meaning no relief for the escalating costs that are creating headaches for many of the UK’s 5.5 million SMEs.
“To help bolster public spending in the future, and to allow for greater defence spending, the Chancellor made clear her focus on scything government running costs. With a plan to reduce those costs by 15% by the end of this Parliament, it will be interesting to see if professional services firms are called upon to help the government restructure departments and deliver efficiency gains – there could be some major opportunities for consultancy firms if so.
Today’s announcement by the Office for National Statistics of a fall in the headline rate of inflation below the 2.9 per cent forecast by economists in a Reuters poll to 2.8%, has also attracted commentary.
Daniel Austin, CEO and co-founder at ASK Partners, tells FM Magazine: “A slight dip in UK inflation offers a welcome signal following last week’s interest rate hold, though it highlights the ongoing balancing act amid Trump-driven market volatility, evolving tariff policies, and potential UK tax changes from today’s Spring Statement. The key question now is how quickly lenders adjust mortgage rates and whether this pause on rates holds. For homeowners and buyers, the desire for lower borrowing costs is clear, but persistently high fixed mortgage rates may limit immediate relief. Still, a more stable rate environment could gradually rebuild buyer confidence, especially among those waiting for clearer economic cues.
“For investors and developers, the path toward rate cuts remains pivotal, with even a modest inflation drop supporting that trajectory. Demand continues to thrive in resilient, high-growth sectors like co-living and build-to-rent, where persistent supply shortages keep capital flowing. As potential policy shifts and economic changes loom, agility is crucial. If rates ease, as some anticipate, it could fuel a more sustained recovery in transactions and investment flows. However, with uncertainty still clouding the outlook, strategic financial planning remains essential to navigating what comes next.”
A spokesperson for LAVA Advisory Partners, says: “Inflation stabilising is a welcome sign that price pressures are gradually easing. The timing is no doubt a welcome boost ahead of the Chancellor’s Spring Statement, too.
“However, with inflation still above target, the Bank of England is unlikely to rush into interest rate cuts. While businesses and consumers will take some comfort in this trend, the real test will be whether inflation continues its downward path in the coming months as the major bodies predict, in which case we should be in good shape for a strong end to the year.”
Commenting on the potential impact of the spring statement on the construction industry, Karl Horton, chief data officer at BCIS, says: “There wasn’t much in the Chancellor’s statement for the construction industry to rely on over the coming months, especially with the OBR halving its 2025 growth forecast since the Autumn Budget.
“It’s interesting that the government is now talking about getting ‘within touching distance’ of its housing target after months of the industry outlining why it was so unlikely 1.5 million new homes was possible, though the £2 billion additional investment in social and affordable homes is welcome.
“Elsewhere, the already-announced £625 million investment to train up to 60,000 skilled construction workers over the next four years is still insufficient to replenish the workforce lost since before the pandemic.
“While making the industry more attractive to new workers isn’t solely the government’s responsibility, firms have little incentive to expand their workforce and invest in training while economic uncertainty persists.
“Unfortunately, investment and funding decisions are subject to ongoing volatility, with the threat of tariffs and escalating trade tensions hanging over the UK.”
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