What has moved from press release to policy
Only two things so far, and both are worth knowing about.
VAT comes off domestic electricity bills on 1 October. It is a household measure, but plenty of small operators feel it too — the coffee shops, the salons, the single-van trades sitting below the VAT registration threshold. Across a region with this many micro-businesses, it adds up quietly.
The second is business rates. From April 2027, roughly 32,000 pubs, clubs and live music venues get a 20% reduction. That is around £1,100 back in the till each year for a typical venue, at a cost to the Treasury of about £100m annually (Property Week, July 2026). In practice that lands on the high streets — East Grinstead, Dorking, Reigate, Horsham, Epsom — rather than on the industrial estates.
The bigger prize is still unconfirmed. Ministers have floated lifting the threshold for small business rates relief to £18,000 from its current £12,000, and stretching the tapered band up to £21,000 from £15,000. The wider high street package is put at roughly £880m (ITV News, July 2026). The Chancellor described the first round as “just one step”.
Put Wednesday 28 October in the diary. That is the Autumn Budget, and that is where this either becomes real or does not.
The runway, at last
While Westminster was busy reshuffling, the Court of Appeal quietly dismissed the final legal challenge to Gatwick's northern runway. Consent was granted by the Secretary of State back in September 2025. The High Court backed that decision in June, and with this month's ruling the last obstacle has gone.
Gatwick's figures put it at roughly 14,000 new jobs across the south east, about £1bn a year into the regional economy, and headroom for up to 80 million passengers.
For anyone trading in this region, that is a larger piece of news than anything the Chancellor is likely to say in October. It does not just affect the businesses sitting on the airport's doorstep. It ripples out through logistics, engineering, hospitality, professional services and everything that feeds them, from Horley up to Epsom and down through Mid Sussex.
Lenders notice this sort of thing. Location is not a soft consideration in a credit paper. It is a paragraph somebody actually writes, and a decent occupier story sits behind every commercial valuation I see.
Two devolution timetables, one Diamond
This is the bit that makes our region unusual, and I do not think enough people have clocked it.
The Diamond straddles a boundary, and the two halves are moving at different speeds. It’s not quite the Spice Girls and Two Become One, but several are becoming few.
On the Surrey side, twelve councils become two. Epsom and Ewell, Mole Valley, Reigate and Banstead and Tandridge all fold into a new East Surrey Council, with a shadow authority running from May 2026 and the real handover in April 2027 (Surrey County Council).
On the Sussex side, the combined authority covering West Sussex, East Sussex and Brighton & Hove was established in March 2026, but the first mayoral election has been put back to May 2028 (GOV.UK).
The direction of travel nationally is that local authorities keep a bigger share of what they raise, starting with business rates. Which means two similar businesses, ten miles apart, could end up under quite different regimes with quite different appetites for relief. Nothing to lose sleep over yet. Plenty to keep an eye on, particularly if you are choosing between sites.
What it all does to property
Rates are not a side issue when somebody is weighing up a building. They form part of an occupier's total cost of being there, which sets the ceiling on rent, which in turn is the income a lender is actually lending against. Bring the occupancy cost down and tenants tend to stay. Tenants who stay produce income a bank can believe in.
The bigger constraint round here is the age of the buildings. Much of the region's commercial property stock went up in the fifties and sixties and has been patched rather than replaced ever since.
The numbers show the split plainly. Grade B space is letting at roughly £15 to £20 per square foot, refurbished Grade A at £27 to £28, and the best new offices north of £30. Around 200,000 sq ft was taken up in Crawley over the last twelve months, the strongest showing since 2021 (Vail Williams, 2026).
Then there is EPC. Larger non-domestic property needs a minimum rating of B by 2031. Lenders are not waiting until 2031 to price it. I have watched the gap between an EPC C and an EPC E move both the interest rate and the loan to value on the same building. With this much ageing stock in the region, that is a live issue rather than a diary note.
One more thing borrowers rarely expect: an occupied building and an empty one are valued on quite different bases, and the Landlord and Tenant Act 1954 sits behind a lot of lender appetite. I have written elsewhere about why a 70% commercial mortgage is often nothing of the sort.
Development and the housing push
Council housing is the declared priority. The tools being talked about are discounted public land, development corporations to unpick planning delays, and higher density in town centres rather than building outwards.
For smaller developers in this region that is a mixed bag. More land coming forward and faster consents are genuinely helpful, and the tight, awkward town centre sites the volume housebuilders will not look at are exactly what development finance exists for. But margins on affordable-led schemes are slimmer, and the exit is usually one bulk sale to a registered provider rather than a steady run of open market completions. Lenders examine single-counterparty exit risk closely, and rightly so.
Repurposing is where a lot of the local activity already is. Tired offices across the Diamond are becoming clinics, gyms, trade counters, EV charging and retail, or coming down altogether. Every one of those is a funding exercise as much as a planning one, and the two rarely run to the same timetable.
Two practical points. Development finance does not arrive as a cheque. It works more like a tab that opens in stages, each one released only once a monitoring surveyor has signed the work off, which means your lender takes a fresh view of the scheme every time you draw. Sort out your development exit finance long before the final unit starts refusing to sell. If a partner is involved, joint venture finance causes more confusion than any other product I handle.
The lending market, without the spin
Everything above is context. This part is the answer.
On 30 July the Bank of England held base rate at 3.75% for a fifth meeting running. Inflation sits at 2.6%, and the committee meets again on 17 September.
Not that base rate sets the price of a fixed commercial loan. Swap rates do, and they take their cue from things no politician has a hand on. The useful part is the steadiness. Back in 2022 and 2023 I had offers repriced underneath me while we were still assembling the paperwork. That is not the market we are in now.
Banks lent £68bn to smaller businesses last year, a rise of 9%. Only the Covid spike has beaten that in thirteen years (British Business Bank, Small Business Finance Markets Report 2026).
A further £6.5bn has gone into the Growth Guarantee Scheme, which is expected to reach some 33,000 businesses across four years. Hardly anyone realises the scheme will also refinance and restructure borrowing you already have, rather than only funding something new.
Then the figure I would pin up in every boardroom across the Diamond. Six pounds in every ten lent to SMEs by banks last year came from a challenger or specialist lender. In 2012 that share was 39%. So a refusal from the bank you have banked with since the nineties tells you what 40% of the market thinks, and nothing more. I set that out for somebody most weeks, and it is a fair description of what a broker is really for.
Why I take this personally
I left banking because of what I saw in 2008. Perfectly solvent businesses had their facilities pulled from under them, and I watched two decades of somebody's work disappear in a fortnight. Lime exists because of that, which is also why noisy political weather still puts me on edge.
Seven prime ministers on, the deals still complete. Lenders who took a sensible view in 2019 are taking one today.
I play golf, not especially well. The shot I regret is almost never the difficult one. It is the one I hit while irritated about the last hole. Reacting to noise is how good businesses make expensive decisions, and there has been a lot of noise this summer.
Three things I would do before 28 October
First, do not wait for the Budget. If you need funding inside six months, start now. Agreements in principle and valuations take weeks, and November will be busy. Waiting to see tends to cost more than it saves.
Second, dig out your EPC and read it before a lender does. In a region with this much older stock it is a pricing question, not an administrative one.
Third, if a bank has turned you down, treat it as one opinion from one institution. There is a large majority of the market you have not spoken to.
Nobody knows what is in the Budget. What I do know, after thirty years of this, is that the businesses that start early consistently get better outcomes than the ones holding out for a certainty that never quite arrives.
If that describes roughly where you find yourself — a purchase, a refurbishment, or borrowing that has stopped fitting the business it was arranged for — my door is open and the kettle works.
David Farmer
Lime Finance Solutions
Frequently asked questions
Has the change of prime minister actually affected lending?
Not directly, and not at any speed. Criteria drift over months, driven by confidence and the tax picture rather than by who occupies Downing Street. Anything that stacked up in June stacks up today.
What has genuinely changed for businesses so far?
Two things. Domestic electricity loses its VAT on 1 October, and licensed and live music venues see rates fall by a fifth from April 2027, saving a typical site somewhere near £1,100 a year. The rest remains a proposal.
Why does 28 October matter?
It is the Autumn Budget, and the Chancellor has already signalled the first announcements were only a starting point. Small business rates relief and how much revenue local authorities eventually retain are both unresolved.
Does the local government shake-up change anything for my business?
Not immediately. Surrey's new unitary councils take over in April 2027 and a Sussex mayor arrives in 2028. Over time, as authorities keep more of what they raise, local decisions on business rates relief may start to diverge across the Diamond.
Will the runway decision change how lenders view this region?
Over time, yes. An extra 14,000 jobs and around £1bn a year makes the case for occupier demand across the region considerably easier to argue, and demand from occupiers is what keeps rent being paid. Banks are far more comfortable lending against paid rent than against a good story.
My bank said no. Should I take that as the answer?
I would not. Six out of every ten pounds banks lent to SMEs last year came from challengers and specialists, against under four in 2012. One institution declining tells you about that institution's appetite, not about your business.
Figures correct as at 20 August 2026. Policy positions described as proposed remain subject to confirmation at the Autumn Budget on 28 October 2026.
David Farmer has more than 30 years in finance, including as a credit underwriter, and founded Lime Finance Solutions in 2012. FCA Authorised. ALIBF Qualified. Commercial mortgages, business lending, property and development finance.
