What the property industry wants from a Labour government

Sir Keir Starmer’s new Labour administration claims to want to sweep away planning red tape and get Britain building again, promising a house building boom.

It is widely expected that the task of planning reform will be on the agenda of deputy prime minister Angela Rayner, who spoke at this year’s UKREiif about potential new towns development and a commitment to social housing.

While many in the property industry have given the incoming government a cautious welcome, their calls are to priortise long term stability that can speed up development and properly fund planning departments in cash-strapped local councils.

Justin Young, CEO of the Royal Institution of Chartered Surveyors, said policymakers must introduce in a timely manner a programme of policies that speed up development and add significant resource to planning departments up and down the country. 

He added: “Planning reform is needed to ensure we empower SMEs housebuilders to add additional capacity and expertise. Smaller builders require much more certainty – something the current system does not deliver.”

Stephen Bell, Chief Executive of planning consultants Turley, said Labour’s win should bring “a renewed sense of hope” to the housing market. “There are immediate changes to the National Planning Poilicy Framework that should be made to support new development, but we also need a long-term strategy for housing that provides the housing market with a clear plan on how we can build the homes we so desperately need.”

Fewer than 70,000 planning applications were in the last quarter of 2023, the lowest on record, and fewer even than during the height of the pandemic.

Rayner said Labour’s “New Towns Code” would include a “gold standard target” of 40% affordable homes, including a mix of social and council homes, robust design codes that fit in with nearby areas, high density housing with good links to town and city centres, and access to nature and parks.

John Glenton, Executive Director of Care and Support at Riverside in Liverpool, one of the largest providers of social housing in England said a scarcity of housing supply is creating “a humanitarian crisis” as more and more families are priced out of housing and end up living in temporary accommodation. 

“This situation is also causing a financial crisis for local government with councils in England spending more than £1.7bn on temporary accommodation last year – double the amount they spent seven years ago.

“The new government needs to take an invest to save approach if we are to ease the housing crisis and be successful in reducing homelessness and rough sleeping. As the economy grows, the provision of social and affordable housing must become a top spending priority.”

“For too long housing has not had the priority it deserves. To tackle the housing crisis, we need the government and providers to work together to create a long-term plan for housing, prevent homelessness and shape a fairer welfare system.” 

Paul Smith, Managing Director of The Strategic Land Group, said: “The Labour government’s commitment to delivering the homes we need, and to making the changes to the planning system necessary to achieve that, is very welcome indeed. Having been so clear about their intentions during the election campaign, and with a historically large majority in the Commons, Labour have a clear mandate for those reforms. Combined with the thoughtful, considered nature of the changes proposed, it must be hoped that will ensure this government is actually able to deliver them.”

David Giovanni, managing director, Bluecroft Finance, said: “The change of government is highly likely to bring a short-term bounce in confidence. The property market has frozen, really without good reason, since the election was announced and this should now be released. Interest rates will almost certainly come down in the next few months and possibly again by the end of the year.”