Assetz® News - Investors await government decision

Investors await government decision

25th June 2008 |

Infrastructure and the facilities offered by local areas are just one aspect that must be considered when choosing the perfect buy-to-let property - but it is important that it is not neglected. In fact, there is certainly plenty of real-life proof that investment in these areas can significantly boost the investment potential of a city or region.

It was only last week that Paul Collins, property editor of investment website BuyAssociation, noted the difference the congestion charge had made to the property market in London, suggesting that a similar fee in Manchester could boost the transport system there and thus property prices in both residential and commercial sectors. So it is understandable that the Institution of Civil Engineers (ICE) is urging the government to ensure investment in infrastructure is maintained.

Today, MPs are voting on the reformed planning bill, which, according to ICE, is essential for the continued competitiveness of the UK property market. The body has warned the government that if plans for future infrastructure projects are scrapped there could be far-reaching implications.

"The current approach to planning for major infrastructure is holding up this investment, with projects dragging on for years or being scrapped altogether. Heathrow Terminal 5 took over seven years to get a planning decision and the Bexley energy from waste plant took even longer, with a decision not taken for over 15 years," ICE's director general Tom Foulkes said. He claimed that water systems, energy and waste networks, and public transport all need investment to maintain a high quality of life in the UK. There is also no doubt that the property market will look a lot healthier if more money is spent in these areas.

Under the proposals, the independent planning commission will be responsible for overseeing "nationally significant projects", the body said, while a sustainable development framework will become much clearer following the reforms. Mr Foulkes added that the new bill will be the best option for the country.

Investors are sure to side with ICE as the property market is certainly in need of reinvigorating, and it is probable that ICE's suggestions are more favourable to buy-to-let owners than chairman of the North West Development Agency Bryan Gray's letter to business secretary John Hutton. As reported by the Liverpool Daily Post, Mr Gray has called on the government to reconsider it stance on raising taxes on unoccupied commercial properties.

"Our suggestion would be to review the decision to raise property taxes from empty commercial premises," the paper reports him as writing. "Speculative build has virtually disappeared in England, partly as a result of this decision. As there is little tax take to be lost from this decision, we believe it would help stimulate recovery in confidence in the property market."

Buy-to-let investors could certainly be advised to watch this space - as the government may choose to go down a number of routes in a bid to revive the UK property market. Those who are well informed and keep abreast of these changes are surely the most likely to make the right investment choices.

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