The Labour Party have now published their manifesto ahead of the General Election next month.
This post explains five of their main proposals intended to fix the housing crisis.
You can read about the Conservative Party's manifesto here and the Liberal Democrats’ manifesto here.
Although the Labour Party have not set out a specific overall housing target, the manifesto makes a bold statement regarding the country's house building programme. The opening paragraph of the ‘Housing’ section renews a pledge made by the party in 1945 to ‘proceed with a housing programme with the maximum practical speed until every family in this island has a good standard of accommodation’.
The manifesto commits the party to delivering ‘a new social housebuilding programme of more than a million homes over a decade with council housing at its heart’. This will be achieved by increasing the rate of housebuilding to at least 150,000 council and social homes each year by the end of the parliament.
The party have pledged that 100,000 of these homes will be built by councils for social rent in what they describe as ‘the biggest council housebuilding programme in more than a generation’. In order to achieve this, there will be a new duty on local authorities to build homes in their area. Local authorities will receive funding from central government to do this.
A Labour government will set up a new body which they have called the ‘English Sovereign Land Trust’. This trust will have powers to ‘buy land more cheaply for low-cost housing’. Alongside this, the party would ensure that public land was used to build homes and not sold off. They would also introduce penalties for stalled housing schemes so that developers would face what they describe as ‘use it or lose it’ taxes.
The manifesto commits to protecting the Green Belt and prioritising development on brownfield sites.
There is no further information on where the homes are proposed to be located.
The Labour Party, like the Liberal Democrats, have pledged to introduce a zero-carbon standard for all new homes. Labour have also committed to upgrading ‘almost all of the UK’s 27 million homes to the highest energy-efficiency standards’.
Other pledges that may have an impact on the housing and development industry are proposals to:
It is notable that the Labour Party manifesto does not commit to a specific overall housing target but instead pledges to build at ‘maximum practical speed’. This is ambiguous and allows the party some flexibility should they find themselves in a position where housing delivery rates are lower than hoped for.
Notwithstanding this, the commitment to build 150,000 social and council houses is ambitious. This is especially true of the fact that they propose 100,000 of these homes to be provided by local authorities. This level of housebuilding by local authorities has not been seen since 1977 according to MHCLG figures and is considered further here by the BBC’s Reality Check Team.
Delivering this number of council and social homes without impacting the delivery of other types of housing will undoubtedly be a challenge. The ban on the sale of public land, for instance, would mean that homes which would have been delivered by private developers been built by local authorities instead - albeit probably for a different tenure. While this would increase the supply of affordable homes, it would do little to boost the rate of house building overall.
The establishment of an ‘English Sovereign Land Trust’ would also be potentially challenging for the Labour government. The power to buy land more cheaply would presumably involve using Compulsory Purchase Orders to purchase land at below market value. This would essentially entail a form of land value capture which has been the topic of much discussion in the media. It has been argued that this could interfere with landowner’s property rights and might therefore be contrary to the European Convention of Human Rights. If this commitment is implemented, no doubt it will be tested in the courts.
The manifesto also states that the party would tax developers for stalled housing developments. This is curious. If a development is genuinely stalled, perhaps due to technical issues or financial viability, then levying a tax on the developer is at best pointless and at worst risks compounding the problem. If this is instead aimed at so called ‘land banking’, then it is a redundant pledge given that countless independent studies - most recently the Letwin Review - have found no evidence of the practice.
As discussed in our blog post on the Liberal Democrat’s manifesto, the impact of the introduction of the requirement for all new houses to be zero-carbon could have unintended consequences for housing delivery. Where the financial viability of schemes is marginal, this requirement could mean that many schemes become non-viable, acting as a break on supply. The impact of this would be particularly felt in lower value areas – precisely where the jobs generated from house building are needed.
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.
The Strategic Land Group specialises in delivering homes on sites of all types – greenfield, brownfield and even Green Belt.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.
