P2P property chiefs respond to Autumn Statement
Peer-to-peer lending bosses envisage a heightened role for property investment after Chancellor Jeremy Hunt’s Autumn Statement was unveiled this morning.
Responding to the raft of austerity measures, Assetz Group chief executive Stuart Law seemed to take comfort in the fact that “the adults are back around the cabinet table”, but pointed out that the measures would be tough for many households.
“With stability restored, it is important that investors now get back to actively managing their portfolios, not least because interest rates are getting close to peak and we expect them to fall back as recession takes hold and inflation slows next year, limiting the possibility of more significant returns from cash savings,” he said.
The statement included tax thresholds being frozen, less generous energy bill support from April 2023, and a reduction in the exempt amounts for capital gains. Higher income taxpayers will also see the 45p threshold lowered from £150,00 to £125, 140.
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“With household budgets under strain and savings alone unlikely to provide exciting returns, investors need to take action to make their money work harder, focussing primarily on portfolio diversification to spread risk and seek out new higher yielding opportunities”, Law said.
“It would also make good sense to look for investments that offer a stable monthly income and the flexibility to easily redeploy, manage and withdraw funds to respond to evolving market conditions, in particular where those investments have inflation-linked returns.”
Law urged investors to “look beyond traditional money management strategies” and said that investing in property can provide a monthly income, “just like a buy-to-let property but without the expense, without the same taxes and with the benefit of an optional tax-free ISA wrapper.”
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Meanwhile, Shojin chief executive Jatin Ondhia said the prime minister and the chancellor has been “caught between a rock and a hard place” in drawing up their “Dickensian Autumn Statement”.
He said while the main focus of the austerity measures was patching up the £55bn fiscal hole, it needs to be acknowledged that the country’s housing crisis is deepening.
“The affordability, quality and volume of homes is worsening for residents, as the upwards pressure on rent is being exacerbated by rising demand and a dwindling supply of homes”, he said.
“This is a national issue and one that can only be solved by taking decisive action to support housing development and boost the delivery of new homes. With housing representing the highest living cost for most, we cannot afford for this ongoing crisis to be once again swept under the carpet in the face of mounting fiscal pressures.”
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