What does the budget have in store for commercial property in Norwich? Robert Flint of Brown&Co discusses.
As the budget approaches on October 30, we anticipate key policy changes that could impact both the occupational and investor markets. Expected changes in taxation, energy efficiency standards and planning policy will likely play a major role in shaping the market’s future.
Capital gains tax (CGT) is a major concern for investors. Any increase could reduce property transactions, as owners may hold onto assets longer to avoid higher taxes.
This could lead to fewer opportunities for businesses to secure suitable commercial spaces, driving up demand and potentially increasing prices.
Potential changes to inheritance tax (IHT) are also on the radar. A higher IHT burden could affect family-owned property portfolios, forcing owners to sell assets to cover tax liabilities.
In Norwich, where many commercial properties are held by long-established local investors, this could lead to more properties coming onto the market, increasing supply but also introducing uncertainties for families trying to preserve wealth through property holdings.
Robert Flint, commercial surveyor at Brown&Co (Image: Brown&Co) Elsewhere, the government’s push for net-zero targets may lead to stricter minimum energy efficiency standards (MEES), requiring landlords to upgrade older properties.
Many commercial buildings in Norwich are older or listed, so this could lead to significant costs for owners, with increased rents passed onto tenants.
However, demand for energy-efficient buildings is likely to grow, creating opportunities for landlords who invest early in compliance.
Changes to planning policy could also bring benefits. Measures to streamline approvals for sustainable developments may boost commercial property construction, particularly in areas of Norwich targeted for growth, like the Broadland Northway (NNDR) and proposed Western Link.
Although interest rates have started to decline, they remain elevated, making borrowing costly for investors and developers. This could temper speculative investments, leading to a more cautious approach in Norwich’s property market. Conversely, this can lead to opportunities for the most acquisitive investors.
As the budget unfolds, local stakeholders will need to adapt quickly to capitalise on new trends and manage potential risks.
Robert Flint, commercial surveyor at Brown&Co, can be contacted on 01603 629871.
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