Labour’s 2024 manifesto outlines an ambitious plan to address the UK’s housing crisis, focusing on increasing the supply of affordable homes, reforming rental laws, and making homeownership more attainable.
Boosting Housebuilding
Labour has committed to building 1.5 million homes over the next decade to address the chronic housing shortage. This plan prioritises the construction of social and council housing, with the aim of providing affordable homes to those in greatest need. Local authorities and housing associations will receive increased funding and support to drive large-scale housebuilding projects. Given many developers will take out specialist funding to pay for the development it will be interesting to see if development funders are offered any incentives to provide funding or whether the government support will be in direct conflict with private funding.
Additionally, Labour intends to reform planning laws to streamline development processes and focus on using brownfield sites for new housing. The party also aims to ensure all new homes meet high environmental standards, with a focus on energy efficiency and sustainability as part of its broader climate goals. We are already seeing the increase in planning conditions relating to the provision of green tech for example EV charging points.
Reforming the Rental Market
Labour’s manifesto places a strong emphasis on protecting renters by introducing rent controls, which will limit rent increases and make renting more affordable. The party also plans to abolish Section 21 ‘no-fault’ evictions, providing greater security for tenants by ensuring landlords cannot evict them without reason. It will be interesting to see how this is balanced against the rights for the property owner to take back possession of their own property.
Labour will promote longer-term tenancies, giving renters more stability and predictability. They will also regulate platforms like Airbnb, which are contributing to housing shortages in some areas by converting long-term rentals into short-term lets. Labour plans to introduce licensing schemes to limit the number of short-term rentals, ensuring more properties are available for local residents.
Making Homeownership More Accessible
Labour aims to make homeownership more achievable, particularly for younger and first-time buyers. The party plans to reform the Help to Buy scheme, making it more accessible and better targeted. This will include new shared ownership schemes and discounted homes for key workers and first-time buyers.
To prevent developers from hoarding land and restricting supply, Labour also plans to tackle land banking. Developers who fail to build on land with planning permission within a specified timeframe could face penalties, ensuring that more homes are built in a timely manner. We do not yet know what form these penalties are likely to take, and it is likely to be a very unpopular regime. This policy appears to not delve into the reason why planning is not implemented. There can be a number or reasons why planning is not implemented – the conditions are too onerous, it is no longer cost effective, etc. and so any policy punishing developers for not implementing planning may have the opposite to the desired effect.
Conclusion
It is quite clear that the UK is currently in a housing crisis, and has been for several years for which there is no quick fix. Labour’s 2024 property plan represents a consumer focussed strategy, and looks at the end result as opposed to impact upon the producers. It will be interesting to see what the actual impact will be upon the UK housing market. The upcoming policy changes will need to strike a balance between the desire to provide the above with the proposed impact upon the developers and those other providers in the property industry. For further information, please contact us to speak to a member of our Real Estate Team.
