As the General Election approaches, the Labour Party have published their manifesto setting out what they would do if they are in power by the end of June.
This post considers the five over-arching themes for the housing market and development industry that the manifesto sets out.
The overall objective
The Labour Party manifesto identifies that “Britain has a housing crisis – a crisis of supply and a crisis of affordability.” To overcome the crisis, the Labour Party aim to deliver “Secure Homes for All.”
The various policies and aspirations for how that would be achieved can be grouped into the following five areas.
1. A bigger role for government in building new homes
A Labour government will “invest to build over a million new homes” including 100,000 council and housing association homes a year for affordable rent or sale.
To help achieve that, a new Department of Housing would be tasked with improving the number, standards and affordability of homes.
The Homes and Communities Agency would also be overhauled to become a housing delivery body, while Compulsory Purchase Order powers would be updated to make them more effective in driving regeneration.
The building of new homes will be a priority for Labour’s new National Transformation Fund as part of a joined-up industrial and skills strategy.
2. Influence the location of new homes
The redevelopment of brownfield sites would be prioritised by a Labour government, who would also look to protect the Green Belt.
In an effort to limit urban sprawl, Labour intend to start work on a new generation of New Towns. There will also be investment in housing in rural areas as part of a wider strategy to ensure economic growth isn’t just focused on towns and cities.
3. Improve new home standards
As well as building more homes, the aim would be to build better homes too. That would include establishing minimum space standards and consulting on new standards for ‘zero carbon homes.’
4. Bolster the planning system
Labour also plan to “properly resource and bolster planning authorities with fuller powers to put people and communities at the heart of planning.” The aim is to make planning departments more able to “stand up to big developers.”
Local plans will be required to specifically address the need for older people’s housing. There is also a very specific proposal to introduce an ‘agent of change’ principle in planning law, to ensure that new housing developments can coexist with existing music venues.
5. Help people buy homes
The current Help to Buy scheme will be guaranteed until 2027. When new homes are built, local peole will be given priority over buying them.
Some other points
Elsewhere in the manifesto are a number of other policies which will impact on the housing market and development industry, including:
- Increase the transparency of land ownership.
- Introduce more protections for those in rented housing, especially in relation to lease length and rent increases.
- Suspend the Right to Buy and only allow councils to reintroduce it when they can prove that 1-for-1 replacements are actually being delivered.
What impact will all these proposals have?
There are a number of policies in the manifesto that are likely to boost the supply of housing. An increased role for councils and government in actually building is almost a necessity if more homes are to be delivered. In the past, rates of development have only exceeded around 200,000 homes a year when the public sector has taken an active role.
Reforming the Homes and Community Agency (‘HCA’) could be beneficial too. Until 2010, when it had many of its powers (and most of its budget) removed, the HCA had managed to bring forward many complex, government owned sites for development.
Elsewhere, the proposals run the risk of slowing down build rates.
For example, the pledge to increase funding for planning departments will be hugely beneficial if it increases the quality and speed of both plan making and decision taking. But if the new powers that would go with it result in more obstacles being put in the way of developments being brought forward then delivery rates are likely to slow.
Despite the step change in the number of homes to be built by councils, the private sector will still need to deliver at least 150,000 new homes a year for housing need to be met. Some of the homes that councils will build are likely to be on sites that would otherwise be sold to the private sector for development anyway. That means reaching the magic 250,000 homes a year threshold is still likely to need an increase in the supply of sites.
If Labour win the election, the challenge for them will be to balance those ‘pro-community’ policies with the pro-development policies in a way that means the housing supply will increase quickly enough to address the housing crisis.
How this could impact on you
Whether or not Labour win the election, the manifesto makes their commitment to solving the housing crisis obvious.
Although it is proposed that government and councils will play a bigger part, private developers will still have a huge role to play. Large numbers of new sites will still need to be brought forward for development.
We work with land owners to deliver planning permission on their behalf at our cost and risk. Our return is a share of the value of the site once it is sold. If we don’t succeed, it doesn’t cost you anything.
If you have a site that you think might benefit from our approach, get in touch with us today for a free, no obligation assessment.