![Property Industry Responds To Labour'S Manifesto Housing Plan 2 Kier Starmer](https://propertyindustryeye.com/wp-content/uploads/2024/06/Kier-Starmer-336x224.jpg)
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Sir Keir Starmer has just published the long-awaited Labour manifesto, outlining the key policies of his future government.
Labour wants to raise taxes by £8.6bn by launching raids on overseas property investors, private schools and non-residents.
On housing, the party has promised major reforms to the housing industry aimed at helping more first-time home buyers get onto the home-buying ladder.
The party wants to use “poor quality” green belt land to develop 1.5 million homes, including “the biggest increase in social and affordable housing in a generation”.
Labour has set a home ownership target of 70%, which will be partly supported by the introduction of a new mortgage guarantee scheme which will allow buyers to buy a new property with just a 5% deposit.
I will also be pushing the Tenancies (Reform) Bill, which includes the abolition of section 21 evictions.
The 125-page manifesto also confirmed Labour would take “decisive action” to improve building safety through new regulations.
Meanwhile, the government has promised to look at how to better protect leaseholders, who do not own the land they live on and may be forced to pay exorbitant maintenance fees and ground rents.
He also said the party would tackle unregulated and “unaffordable” land prices and “unfair” maintenance fees.
Industry response:
Rightmove property critic Tim Bannister said: “We welcome policies and innovations that help more first-time buyers get onto the home-buying ladder. Housebuilding needs to accelerate and creating a permanent Mortgage Guarantee Scheme would at least give first-time buyers the confidence that they have options. But our research knows that policies like the Mortgage Guarantee Scheme have limitations and will only help a small proportion of future first-time buyers who meet the specific requirements. One of the biggest barriers for first-time buyers is being able to access enough borrowing from lenders, and the Mortgage Guarantee Scheme does not address that issue.”
He added: “The next administration has an opportunity to improve fundamental aspects of the housing market. The process of buying and selling a home needs to be speeded up and simplified. Currently it takes an average of seven months from the time a home goes on the market to the purchase being completed – it’s extremely slow.”
“To support more first-time buyers, long-term solutions that take into account the wider impact on the market are needed. Since the last election in 2019, the average price of a property for first-time buyers has increased by 19%. Meanwhile, advertised rents for similar properties have increased by 39% – with many renting for longer periods. The imbalance between demand and supply has worsened significantly since 2019.
“We need greater support for faster, better quality housebuilding to ease some of the pressures on supply and demand. If the next administration can transform the supply of new homes by creating smoother planning processes to produce more affordable homes, it will also help people downsize to move into greener homes with lower running costs.”
Nathan Emerson, CEO of Propertymark, commented: “Reform to the planning system, a commitment to prioritise existing homes, improving energy efficiency in the private rented sector and a commitment to build 1.5 million new homes in the next parliamentary term are very much welcome. The planning process can be a major obstacle to keeping up with demand and change is desperately needed to cater for an ever-growing population. Many buyers have found themselves struggling since the 2008 recession and it is vital that any future strategy includes a sustainable mix of affordable housing options for both buyers and renters.
“Propertymark wants to hear more details about how Labour plans to deliver its housing targets and ensure a robust and fair set of policies is in place to serve all demographics.”
“Any desire to reintroduce the Tenants (Reform) Bill must be accompanied by full disclosure and a realistic timeline on the court reforms that are needed before the repeal of Article 21 evictions can become a reality.”
William Nicholls, regional director at Lanpro, commented: “Labour’s manifesto sets out several bold steps to accelerate economic growth, committing to deepening existing combined authority devolution arrangements and devolving power from Westminster by reviewing combined authority governance structures to remove blockade of decision-making. We aim to create jobs and 1.5 million new homes in the next Parliament and get Britain’s construction going again, and we aim to deliver the biggest increase in social and affordable homebuilding in a generation.
“A key change which will be welcomed by the development industry is the immediate update of the National Planning Policy Framework (NPPF) to include regeneration and mandatory housing targets, and it also says it will take tough measures to ensure planning authorities have up-to-date local plans, as well as strengthening the ‘presumption in favour of sustainable development’. How this will work out in practice remains to be seen. Labour is committed to injecting extra funding for planning officers and the necessary staff into planning departments.”
“Labour will continue to take a ‘brownfields first approach’, but another welcome intervention is Labor’s commitment to take a more strategic approach to Green Belt designation, prioritising the release of lower quality ‘grey belt’ land, alongside the creation of a set of ‘golden rules’ to ensure development benefits local communities and nature.”
“BCLP is pleased to be partnering with BCLP to provide a comprehensive, integrated service to our clients,” said William Trotman, real estate finance partner at BCLP. “We are currently seeing a structural shift in capital allocation to the real economy, particularly in commercial real estate but also in other sectors of the credit and lending markets. ‘Private credit’ provided by alternative (non-bank) lenders has increasingly become established as a major source of funding across the capital sector since the Global Financial Crisis (GFC). As their market share grows, alternative lenders are recognised as ‘mainstream’ capital providers alongside banks and the ‘shadow banking’ label is now well and truly of the past.
“With the political agenda firmly focused on economic growth, we do not expect the upcoming UK general election to have any impact on the pace or direction of this change. Rather, we see private credit growth continuing to accelerate as banks strengthen their position as key providers of senior capital to alternative lenders and expand their product pool, both directly and as intermediaries to wider and deeper institutional capital pools.”
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