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Election 2024: Housing’s time to shine?

July 3, 2024

Thursday 4th July sees the much-anticipated General Election in England.  All the major parties have now released their manifestos showing what they would do if elected (as have some of the minor ones…).  Alongside the NHS, the Environment and Immigration, Housing is (finally…) back on the agenda (albeit begrudgingly) and rightly so.  

We have had 17 Housing Minsters in the past 15 years, and 9 in the past 5 (going back to Kit Malthouse).  Alongside this we have had 10 Secretaries of State (since the last Labour incumbent, John Denham).  This is not conducive to a joined up or progressive housing policy.  In fact, Affordable Housing funding has gone backwards over the last 15 years.  In 2010, funding for affordable housing was reduced by 60% as part of the drive to cut the deficit.  At the time the budget was £3.3bn per year, while the current affordable housing grant per year is approximately £2.44bn.  For this grant to even remain at the same level as 2010 after accounting for inflation, this figure should in fact be £5.7bn (almost double). 

Also in 2010, funding for new social rented housing stopped completely and the “Affordable Rent” tenure was introduced, where homes are rented at up to 80% of market rent (though it is arguable that this in itself undermined the affordability of the sector).  This change, coupled with the drop in funding, had a huge impact: in 2010/11 nearly 36,000 social rented homes were started, but by 2011/12 (following funding cuts) this had reduced to only about 3,000.  Today, the sector estimates that only 5,000 such homes are being built each year.  The Department for Levelling Up, Housing and Communities’ figures reveal that homes for social rent are making up a declining proportion of overall affordable housing supply. In 2011/12, social rent made up around 65% of all new affordable housing, whereas this dropped to 15% in 2022/23 (Affordable Rent taking up 38% with Shared Ownership at 32%[1]).

In reality, though, what will each party offer?  Here, we at Sharratts run the rule over the offerings of each of the five main parties and provide our thoughts on each set of proposals and what they could mean for the sector. 

1) Conservatives:

  • Build 1.6 million new homes over 5 years (protecting all Green Belt but establishing a planning fast track for some previously developed brownfield sites).
  • Abolishing Nutrient Neutrality (replacing it with a one-off mitigation fee).
  • Creating more urban development corporations.
  • Renewing the Affordable Homes Programme
  • Help first time buyers with a new Help to Buy Scheme requiring only a 5% deposit and scrap Stamp Duty for them for properties up to £425,000.00.
  • Complete leasehold forms that will cap ground rent at £250.00 and support leaseholders affected by historic safety problems.
  • Introduce a temporary measure that means landlords who sell their property to their tenants will not have to pay Capital Gains Tax.
  • Ban so-called no-fault evictions as part of a wider Bill to reform the rental market.
  • Bring in rules to evict tenants from Social Housing after 3 instances of anti-social behaviour such as noise disturbances or vandalism and introduce ‘Local Connection’ and ‘UK Connection’ tests for applicants.

Sharratts’ view:  We hope it is not a sign of things to come that you have to get all the way to page 53 of this manifesto to reach the section on Housing.  Overall, these policies have a distinctly underwhelming feel to them.  The highlights are the stated aim of building 1.6m homes over 5 years (though detail is light and this seems over optimistic in the first instance) and the abolition of Nutrient Neutrality (though a stated attempt to do this in 2023 already failed).  However, the stated policy to “Renew the Affordable Homes Programme” is particularly alarming, as this is considered a ‘given’.  Some of the policies also look to favour Landlords, though they are framed as benefitting tenants (such as the Capital Gains Tax allowance).  It is also disappointing to note further focus on helping first time buyers without a corresponding focus on renters.  There is no mention of any regulation or controls in the private rented sector, and only talk of anti-social behaviour of social tenants (which is a cliched view – what of such behaviour in private rented properties?).  A number of measures are proposed which also failed to be enacted in the current parliament (such as ground rent reform and no-fault eviction bans). 

Our rating: Lack of any real thought or imagination and while a promise to deliver 1.6 million homes in 5 years is laudable, the big numbers do not reflect reality, especially given current building rates.  A lack of modular housing, and the inclusion of a number of policies which the party were unable to get through during the current parliament makes this feel like “more of the same”.


2) Labour:

  • Reform the Planning system (including the CPO process) and reinstate local targets to help build £1.5 million new homes over 5 years (while fast tracking brownfield sites and release some “low quality” green belt for housing).
  • Make changes to the Affordable Housing Fund to deliver more from existing funding.
  • SDLT surcharge for non-UK residents.
  • Implement solutions to unlock nutrient neutrality affected sites without affecting the environmental protections.
  • Build a new generation of new towns.
  • Prioritise the building of social rented homes.
  • Reviewing the Right to Buy scheme by reviewing the discounts and increasing protections on newly built social housing.
  • Introduce a private mortgage guarantee scheme to help first time buyers and introduce prioritisation of them over investors.
  • Make it easier and cheaper for leaseholders to extend leases and ban new leasehold flats whilst tackling unregulated ground rent charges.
  • Ban so-called no-fault evictions and empower renters to challenge unreasonable rent increases.

Sharratts’ view: You would initially be forgiven for thinking you had re-read the Conservative manifesto here, so similar are most of the policies.  This is not necessarily a bad thing, as it encourages cross-party consensus.  However again we argue that this is not radical enough to fix a system so broken by chronic neglect and underfunding over many years.  Again a highlight is the stated aim of building 1.5m homes over 5 years (though again this seems over optimistic in the first instance).  The focus on a new generation of New Towns is a good one and mirrors the Tory promise to setup new Urban Development Corporations.  However, these generally favour homes for sale rather than rent, so could they also have their own affordable housing function, along the lines of Local Authority housing, perhaps?  We also applaud the stated focus on building of social rented homes and the mention of changes to the Affordable Housing Fund (hopefully to widen the range of schemes this fund can be spent on).  However, again we are disappointed to see no mention of the over-priced and under competitive (from a tenant’s point of view) private rented sector.  This manifesto can be forgiven for mentioning things which failed during parliament this time, as the party was not in power.  It is also good to see Housing get a higher billing – coming in at page 36 of 136 in this manifesto. 

Our rating: Good shift to focus on social rented accommodation and changes to the affordable housing fund (though these are not detailed in full) but otherwise as with the Conservative plans, not overly exciting or imaginative, and the big numbers do not reflect reality during what will be a difficult first 5 years.  No mention of Modular construction, which seems surprising.


3) Liberal Democrats

  • Build 380,000 homes a year across the UK with at least 150,000 new social homes with ten new garden cities and community led developments.
  • Give Local Authorities powers to end Right to Buy in their areas.
  • Abolish residential leaseholds and cap ground rents at a nominal level.
  • Ban so-called no-fault evictions and make three-year tenancies the default.
  • Introduce a ten-year emergency upgrade programme to make homes warmer and cheaper to heat.
  • End rough sleeping by 2029 and scrap the Vagrancy Act that criminalises many forms of homelessness in England and Wales.
  • Introduce a new Rent to Own model (over 30 years).
  • Encourage use of Rural Exception Sites.

Sharratts’ view:  Again, it is initially disheartening to see Housing only come in on page 71 of 117.  However, this manifesto offers some good and thought-provoking proposals.  As with the Conservative and Labour manifestos the housing numbers are arguably unrealistic given current building volumes.  However, the local autonomy for authorities to end right to buy is interesting (perhaps utilising existing Designated Protected Areas legislation).  The ten-year emergency upgrade programme is good, though this is arguably just the social housing decarbonisation fund in another form, and that is already grossly underfunded.  The most interesting of all are the new Rent to Own model (this has been utilised by RentPlus and others already very successfully in recent years) and the stated “full abolition of residential leaseholds”.  This last point was mooted by the conservatives but could not be pushed through legislatively.  It would be interesting to see how this would be enacted – arguably registered providers should still be allowed to grant social tenancies and shared ownership tenancies, but only registered providers.  Such a policy would negate the need for any rent cap on the private sector.  Though it would arguably cause a flight of capital out of the sector, this is arguably overdue to an extent within the private (and relatively unregulated) sector.  

Our rating: Some really good policy ideas in here, though lacking in the shift to focus on social rented accommodation from the Labour plans.  Again, the housing numbers look unrealistic, but the abolition of residential leaseholds and Rent to Own model are both very interesting (if we ignore the obvious paradox of having a residential tenancy policy while banning residential tenancies…).  It is likely that this would be “unfundable” unless additional revenue is directed from elsewhere.  No mention also of the Affordable Housing Fund and either increasing it or refining it (as per Labour).  Still, some radical proposals, but no modular housing.


4) Green Party

  • Provide 150,000 new social homes a year by building or refurbishing older housing while protecting the Green Belt
  • End the Right to Buy.
  • Allow Local Authorities to introduce rent controls and give tenants more rights including an end to so-called no-fault evictions.
  • Give Local Authorities, Social Landlords and Community Housing Groups the first option to buy certain properties at a reasonable rent.
  • Insist Local Authorities spread small developments across their area and that they are accompanied by investment for local services.
  • Require new homes to be built to the highest energy efficiency standards.
  • Fund a Local Authority led programme to improve insulation and restore local heating systems such as heat points in homes.

Sharratts’ view:  A good start as Housing is picked up on page 6 of this ‘wordy’ manifesto.  They correctly grasp that housing has become viewed as an asset and this needs to change.  Their numbers for provision of housing a more circumspect – 150,000 a year (but entirely social) as they are “provided” not built, so include refurbishment as well (though the amount of units refurbishment will offer is arguably minimal).  Ending the right to buy is a good step in protecting the already scarce supply of social housing, and the autonomy for Local Authorities to introduce rent controls is a welcome proposal, which tallis with Sharratts’ longstanding calls for private rents to be capped or regulated more closely.  The further changes to building regulations to improve the energy efficiency of homes is also something which has been called for for some time, though the requirement for Passivehaus standards will further inflate build costs in the first instance (currently they are around 8%-9% higher than standard build).  However, there are also mixed messages.  The Greens want to reform planning so large-scale developments are reduced and fragmented into multiple smaller developments – the planning system already struggles with demand, this would place further strain on it and would arguably lead to developments being held up further.  Finally, the “Greener Homes Guarantee” talking of Investment over the next 5 years of £49bn is patently unattainable and, in reality, not helpful to the overall debate as a result.  

Our rating: As with the Lib Dems’ manifesto there are some more good policy aims in here, though again lacking in the express shift to focus on social rented accommodation from the Labour plans, and fewer ideas than the Lib Dems.  The housing numbers look unrealistic as they appear more based on refurbishment than development, but the abolition of right to buy is a good approach and rent control powers for Local Authorities are welcome.  However, it is likely that this manifesto would be “unfundable” due to the sheer costs of build standards proposed, and insulation improvement schemes.  There is also still no mention of modular housing, a disappointment from the Greens in particular.  


5) Reform Party

  • Reform the Planning system with fast-track decisions and tax incentives to develop brown field sites.
  • Increase use of new construction technology such as modular construction.
  • Prioritise local people and those who have paid into the system for social housing, not foreign nationals.
  • Encourage more people to become landlords by scrapping tax changes introduced in 2017 to 2021 known as Section 24.
  • Make it easier and cheaper for leaseholders to extend leases and buy freeholds.
  • Scrap the Renters (Reform) Bill and improve the monitoring appeals and enforcement process for the Renters (Reform) Bill.

Sharratts’ view:  Housing gets the mid-table entry into the manifesto for Reform, which is better than some.  However, the housing policies themselves feel like a backwards step and are limited in number.  The reference to modular construction, sadly lacking in all other parties’ manifestos, is to be applauded, as is the fast track for brownfield sites (in common with the other parties).  However, that is about as far as the celebration goes.  Policies to encourage more people to become private landlords, and to abolish the Renters (Reform) Bill are clear moves back towards inequality.  The policy to prioritise local people in housing registers is relatively empty as government data shows that 90% of social housing lettings already go to UK nationals[2].  In any case, Social Housing should be assessed by need not by nationality.

Our rating:  The only party to include reference to Modular construction (albeit fleeting and with little detail) looks to set Reform off to a good start, but their policies as a whole preserve the status quo or even add to disparities in the system.  There is no attempt to curtail the private sector, or to focus on any affordable homes, rather to simply manage the existing stock differently.  Also lacking any meaningful targets to be “measured”.  A disappointing offering. 


So what of these manifestos? 

In terms of policies the Liberal Democrat manifesto appears to offer more – which is surprising given the party’s approach to housing in the past.  It has more radical policies and looks to make more of an impact on the current crisis, though funding would be a serious issue if it were to come to pass.

The one lesson to take is that each and every manifesto has at least one good policy point, so a cross-party consensus beyond the lifetime of the parliament would seem to be the ideal solution – and would promote a long-term housing policy instead of the rampant short-term approach we currently have.

Sharratts (London) LLP’s recommendations for whoever is in power come 4th July

So what would be our ideal policy programme come 4th July.  The issues with the sector are of course many (too many to list here, though none of which are unassailable) but to have any hope of steering the sector on course, we would argue that the following are needed as a minimum:

  1. Caps on private sector rent, based on a set percentage per week of localised average earnings.  The private sector rental market is out of control, and this is putting undue pressure on affordable housing, as well as making Affordable Rent “unaffordable” (as 80% of an extortionate rent is still too high).  The Social Rent formula frequently gets tinkered with or capped, but the private sector remains untouched.  This must be changed.  The knock-on effects this would have across many aspects of society (not just on social rent levels themselves) would make this our number one policy recommendation.
  2. A Cross Party consensus and Working Group on Housing must be established: this is the only way that policy can be enshrined beyond a mere political term, so that the current short-termist approach is overcome and a coherent long-term strategy can be implemented to drive the sector forward.
  3. More Local Authority development.  The sector is currently reliant upon private housebuilders to deliver a majority of its stock.  Sheer market economics require that these developers only construct and sell such housing at a rate they can sell them.  Local Authorities must provide a viable “non-profit driven” alternative alongside registered providers to rebalance the market.
  4. Continue to encourage modular methods of construction.  The terrible inflationary pressure on the housing and construction market in recent years led to a failure of a number of modular models as they are still not fully established in the marketplace.  This should not make us afraid to pursue them further.  If we are truly to deliver the volume and quality of homes needed, modular homes will be a vital component of this.
  5. Allow a wider scope for Homes England grant funding.  Homes England funding currently only allows for additionality outside planning requirements – this means that section 106 schemes are not eligible (unless a time-consuming variation to the S106 Agreement is enacted).  This should be changed to focus on delivery of tenure, rather than requiring additionality (especially when, in reality, we are well-behind delivery targets in any case, so the additionality is only ‘notional’)
  6. Re-instate pre-2010 Affordable Housing funding levels.  The public have been fooled into thinking that spending on affordable housing is increasing in the past parliament, whereas in real terms it is almost 50% of what it was 15 years ago.  This goes hand in hand with drop-offs in delivery.  The next government must instigate a social housing grant programme funded at levels analogous to 2010 (with inflation adjustments) being circa £5.7bn as a minimum.

Any of these points would be well received, but if all were to be taken together the sector would arguably be set well on the road to recovery.  Is any party brave enough to take action on these points and create themselves a lasting legacy?  Here’s hoping…