Sir Keir Starmer vowed that Labor would be “builders, not blockers” if they gained power. Photo: Leon Neal/Getty Images. A perfect storm has hit the UK housing sector.
Rising interest rates, the end of buying aid and strict new planning rules mean the number of homes built in the UK, according to Savills, will fall to a five-year low of 225,000 this year, according to Savills.
The Home Builders Federation has warned that annual commissioning could soon fall below a historic low of 120,000 if current trends continue.
Mapped by so-called nutrient neutrality rules that have stalled entire regions of England and changes under the Conservative government that have made building more difficult, developers say meeting the goal of 300,000 homes a year is approaching the realm of fantasy.
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As Rishi Sunak and Michael Gove, Secretary for Level Up, try to unite Conservative MPs around a coherent housing policy, Sir Keir Starmer and Labor saw an opportunity to take charge of the problem and bring in families who want to climb the property ladder.
Speaking at summer conferences, Starmer and Lisa Nandy, Gove's shadow cabinet opposite, vowed to support “builders, not blockers” if they come to power.
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“That's all. Nothing smacks of decay more than the idea that this country can no longer build something,” Starmer said at the annual meeting of the British Chamber of Commerce in May.
If Labor wins power in the next election – and opinion polls now show that the party is on it – Starmer and Nandy will need more than big words to get the UK to build again.
Labour politics is a mixture of their own and Tory ideas, drawing inspiration from proposals championed by former Deputy Prime Ministers Lord Prescott and Lord Heseltine.
A key pillar will be a series of new and powerful “development corporations”, public-private groupings that will be responsible for promoting housing construction in certain economic areas.
They are expected to combine the best aspects of the Regional Development Agencies (RDAs) set up by Prescott during the New Labor years (since abolished) and the development corporations used by Heseltine to successfully renovate rundown parts of London, Liverpool and Manchester in the 1980s and 90s.
Details are still being worked out, but the idea is that corporations are created by the government in consultation with local authorities. They will focus on long-term housing plans that extend beyond a single election cycle to prevent them from becoming political balls.
They can also play a role in preparing the largest housing estates for development, such as clearing them, building key infrastructure, and then subdividing the land into lots that developers can buy and build homes on.
At the same time, Starmer and Nandy said they would allow further development on Green Belt land, although they insist that this would only apply to “low-quality former industrial land and dilapidated, abandoned bushland” that are currently under protection. .
Industry representatives who met with Nandy's team say Labor is most interested in changes that can be implemented quickly and have the biggest impact on housing stock.
Andy has unveiled a policy aimed at stimulating the housing market. Photo: Christopher Furlong/Getty Images
Much of this will be simply revealing changes made or promised by Gove, including his promise to release councils from the obligation to meet national housing targets. The change has been blamed for at least 50 local governments effectively delaying work on housing land plans.
Labor has little to say about nutrient neutrality yet, but insists it is determined to “unlock” development if the government fails to fix the problem next year.
“Our impression is that it’s all about evolution, not revolution,” says one senior industry source who has met with Labor on numerous occasions.
A Labor source adds: “Over the past 13 years we have had three major overhauls of the planning system, and where did that lead us? We are stuck in an acute housing crisis.
“So we will be pragmatists. There is no solution to the housing crisis, or to our broader economic crisis, that does not involve building more homes, so we are focused on bold but achievable reforms that can ensure building in Britain as soon as possible.”
One source in the FTSE 100 developer says this position will be widely supported by builders, and it can certainly help lift private sector housing construction to the levels achieved under the Cameron and May governments.
“We'd rather they just put in a revised [planning regime] that's more in line with the Coalition era, which really wasn't that different from the current one,” the source explains.
“Going back to that won't be as difficult either, while massive reform takes time and creates delays.”
There is widespread dissatisfaction with the policies proposed and implemented under Gove, who most in the housing industry see as a hostile figure.
Last December, Gove caused a shock in the housing sector when he succumbed to a riot of conservative supporters who demanded that councils be exempted from local housing targets.
The fifth figure in the housing industry. Photo: Paul Grover
While the changes have yet to be implemented — and have since been delayed until at least this fall — uncertainty has prompted 58 local authorities to shelve their housing plans, including Gove's own Surrey Heath constituency, according to the Home Builders Federation.
Tory campaign flyers criticizing the government's goal of 300,000 homes and Rishi Sunak's comments that councils should not be forced to build have sparked further alarm in the industry.
Natural England, the environmental authority, meanwhile has been accused of stalling home construction, delaying some 145,000 homes with demands that new developments be “nutrient neutral”.
Can Labor Those who manage these tangled issues will quickly determine how successful Starmer achieves his target of 70% of homeowners.
However, as always, his party's preference for state decisions can end up causing unexpected problems.
A source at a major real estate developer notes that adding new regional development corporations to the mix could end up hindering rather than helping construction.
“I see the attraction, but the potential problem would be that you just It's just another layer of bureaucracy where failures can happen.”
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