Housing: Plans from the Party Conference Season

There’s a lot of backbiting and hot air in political circles at this time of year. It’s easy to become disillusioned and switch off, ignoring the discussions about things that affect our lives and our businesses. That’s why we’ve pulled together a quick summary of the housing-related issues from the three main party conferences. With the Tories in power, it makes sense to start there.

From the Conservatives

Theresa May’s big news is the proposed removal of the cap on local authorities borrowing to fund the construction of council-owned houses. When the cap was imposed by Margaret Thatcher, about 10,000 homes were being built annually. The numbers plummeted until council housing construction became negligible. Even over recent years, as the housing crisis deepened, and councils were encouraged to do their bit to alleviate the problem, few properties were built. According to the RICS, the new policy represents a ‘large and very positive step’.

What it means for the Property Rental Sector

Councils will be able to play more of a role in housing, offering more homes with affordable or social rents. Councils may reduce their use of private sector landlords to plug the gaps. Locally, schemes of any size, could impact the market and reduce both rental and capital values.

From the Labour Party

Labour is also pledging more affordable homes from both councils and housing associations. But its proposals go further with offers of housing for the homeless and a promise of hefty tax bills on second homes used for holidays. Shadow Housing Secretary John Healey also said the party would back renters’ unions, which would defend tenants’ rights.

What it means for the Property Rental Sector

With almost one in four households now renting privately, renters’ unions could have significant power. Campaigns would be likely to focus on rent controls, property standards and tenancy durations.

From the Liberal Democrats

The party restated its commitment to a major housebuilding programme – three million homes with high environmental standards over the next decade. Details of how this would work are unclear as are the party’s plan for these homes – to be let at social rents or sold at affordable prices. The Lib Dems are also supporters of the rent-to-own model and would work with housing associations to increase construction of such properties. The party would implement a 500% increase in council tax on houses deliberately left empty for long periods. And finally, it would increase stamp duty on overseas residents buying UK properties for investment purposes.

What it means for the Property Rental Sector

As with both of the other major parties, a significant increase in social housing will have a knock-on effect on the private sector. By targeting empty properties, the party will restrict the activities of investors and could hamper those building a portfolio.

In summary

There’s little to suggest that the private rental sector is in any of the major parties’ good books, and we need to be prepared for an increase in social housing provision and perhaps more legislation. But all parties are agreed on one thing: there is a shortage of housing in the UK. It won’t be remedied any time soon, which – if you’re looking for the good news – leaves our sector in a very strong position.