By Chancellor Rachel Reeves’ Spending Review on June 11th marks a clear pivot toward regional investment, infrastructure renewal, and social welfare – all of which will have a meaningful impact on the UK property market, both in the short and long term. Here’s a breakdown of how the announcements could shape different aspects of the property sector:
Key Announcements and Their Property Market Impacts
1.Boost to Social Housing
- Annual increase from £2.3bn to £3.9bn (2026–2036).
- Impact:
- Positive for renters: More affordable homes may reduce pressure on the private rental sector, especially in high-demand urban areas.
- Long-term supply benefit: Could ease overall housing shortages, though the scale still falls short of the 1.3 million people on waiting lists.
2. Transport Infrastructure Investment – £15.6bn (2027–2031)
- Focus on regions outside London, specifically:
- Transpennine Route Upgrade – Improved Manchester–Leeds links.
- East West Rail – Growth in the Oxford–Cambridge corridor.
- Leeds Station – £240m to reduce congestion and improve capacity.
- Welsh Rail Improvements – £300m across key upgrades.
- Impact:
- Capital growth potential: Improved connectivity boosts buyer interest and developer activity in regional areas.
- Buy-to-let opportunities: Potential impact on yields
3. Local Government and Community Investment
- Funding for 350 community projects: parks, pools, youth centres.
- Approved 5% Council Tax rise.
- Impact:
- Area uplift: Enhanced amenities can increase local desirability and property values.
- Council Tax caution: Increased costs for those owning and renting a home, especially in lower-income areas.
4.Sizewell C Nuclear Power Station – Suffolk
- Government-backed project near Aldeburgh and Southwold.
- Impact:
- Short-term construction boost: Surge in local housing demand from workers.
- Long-term economic stimulus: Stable employment could underpin sustained property demand in the area.
Final Take
This Spending Review signals a real effort to improve house building and particularly for regional investment and affordable housing. While it won’t solve the housing crisis alone, the emphasis on infrastructure and social housing lays foundations for more balanced growth outside London, stronger investor confidence, and longer-term affordability improvements.
What do experts within the UK Property Market think?
Kate Faulkner, Property Analyst
I think the Spending Review showed some real understanding of how to boost housing supply in England. We need better transport access to build more homes without causing more congestion. A great place to show how this works is the A14 between Peterborough and Cambridge. This has dramatically increased the capacity of the A14, reduced delays and enabling access to new build areas such as Trumpington, Cambourne and Alconbury.
However, it’ll be interesting to see what happens in the next budget to taxes, as all of this spending will either have to be funded through growth or increased taxes.
Allison Thompson, National Lettings Managing Director of Leaders Romans Group
“To ease pressure across the housing system, the government must do more to keep existing rental homes available, not just promise new ones. With a shortage of social rent properties, the private rented sector is doing the heavy lifting; however, with more tenants looking and fewer homes to let, that gap is becoming harder to fill.
Councils in England spent £2.29 billion on temporary accommodation between April 2023 and March 2024, a 29% increase on the previous year. How much more will that rise while the government focuses on incentivising new development instead of supporting the homes we already have?
“At the same time, the cost of providing rental housing continues to increase. These pressures are ultimately felt by tenants, who are paying more and finding it harder to secure a suitable home. The Renters Rights Bill adds further uncertainty, and there is still no targeted support to help landlords upgrade properties ahead of the expected EPC changes in 2030.
Without meaningful action to stabilise the private rented sector, the gap between housing need and housing access will only widen.”
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