The last day of term is traditionally a time when nothing much happens and we get set for the holidays to come.
Not so much for Angela Rayner. The deputy prime minister marked the last day in parliament before the summer recess this week with a flurry of announcements, guidance and consultation.
Most of these – planning reforms including a new National Planning Policy Framework (NPPF), a new towns taskforce, changes to the right to buy – were foreshadowed in the election campaign and early days of the new government.
However, both her written statement and what she outlined to MPs including some intriguing hints of changes that go well beyond supply and planning.
And there was also an important piece of context: Rayner said the government now expects to deliver just 200,000 new homes in England in this financial year. That is 100,000 fewer than the annual average needed to meet its target of 1.5 million and will ramp up the pressure in the later years of this parliament.
Originally written as a column for Inside Housing.
Amid the excitement of the first Labour King’s Speech in 15 years, it may seem churlish to inject a note of scepticism.
The excitement lies in the prospect of planning reform to deliver more homes, the potential of more devolution in England, the promise of improved rights for private renters and the hope that we could at long last see the abolition of leasehold.
Nobody should under-estimate the potential of this programme to improve the lives of millions of private renters and leaseholders or the determination of the government to use its mandate to deliver more new homes.
Yes, we already knew all of this from Labour’s manifesto but hearing them in the King’s words amid the pomp and ceremony of the state opening of parliament begins their transition from promises on a page to action in the real world.
The scepticism comes from two directions. First, and most obviously, the closer we get to implementation of these reforms the more the details matter.
The background document has some of these but more will follow once the Planning and Infrastructure Bill, English Devolution Bill, Renters’ Rights Bill and Draft Leasehold and Commonhold Reform Bill make their way through parliament over the next few months.
The second reason for scepticism is the hype that comes with it. ‘Take this paragraph from the prime minster’s introduction to the King’s Speech: ‘Too many people currently live with the threat of insecurity and injustice, and so we will make sure everyone can grow up in the secure housing they deserve. We will introduce tough new protections for renters, end no fault evictions and raise standards to make sure homes are safe for people to live in.’
The second sentence describes what the government will do for private renters. These are good but they do not come close to meeting the aspiration in the first.
A dose of high-flown rhetoric is perfectly understandable but Keir Starmer also made a point of stressing ‘patient work and serious solutions, rather than the temptation of the easy answer’.
Originally written as a column for Inside Housing.
Labour’s huge election victory is undoubtedly good news for housing but will it take this once-in-a-generation chance to prove that ‘change’ is more than just a slogan?
You’ll have to have worked in housing for more than 25 years to remember the last time Labour successfully regained power in 1997.
Then, as now, the party took over after a long period in which Conservative governments got to set the parameters of the housing system on everything from tax to investment and planning to benefits.
The Blair-Brown governments made solid progress on homelessness and decent homes and eventually boosted investment in new homes but they blew the chance to change things more fundamentally.
Keir Starmer takes over at a time when housing is significantly higher up the political agenda but the economic backdrop is far bleaker.
So how should we react to Labour’s stunning victory?
Originally written as a column for Inside Housing.
Following his surprise decision to stand down as MP, Michael Gove leaves Westminster as probably the most important politician for housing in the last 14 years of Conservative rule.
As housing secretary since September 2021 (with a brief break for Liz Truss) he was in charge for some of the most consequential legislation of the whole period: the Building Safety Act 2022; Social Housing (Regulation) Act 2023; and Leasehold and Freehold Reform Act 2024.
He also changed the terms of the debate on many issues, issuing public calls for more social housing in a way that would have been unthinkable for earlier Conservative ministers and speaking up for the rights of leaseholders, renters and tenants.
Yet for all that he remains something of an enigma. On a personal level, he was an able minister, open about Conservative failures and willing to engage with questions others would dodge, but he also bequeathed us Brexit chaos and never achieved one of the great offices of state.
The sense of two Goves carried on till the end: speaking to Rishi Sunak in the final Cabinet meeting before the election was called his message was ‘who dares wins’ but two days later it was ‘actually, not me’ as he stood down from his Surrey Heath constituency.
How long can you keep juggling before it all goes horribly wrong?
That’s the question for social landlords posed by a new report from the all-party Levelling Up, Housing and Communities Committee on the finances and sustainability of the social housing sector.
Juggling a couple of balls is simple. Three gets easier with practice. Four needs intense focus. Add more balls and external distractions and you risk dropping the lot.
The issues that need to be juggled are familiar ones: how do you continue to build new homes, decarbonise existing ones, fix fire safety problems and regenerate older stock when there is not enough grant to go around, construction, energy and insurance costs have soared and supposedly long-term rent settlements keep being revisited?
As the report points out, we are already seeing the results. Fiona Fletcher-Smith of L&Q told the committee that under the affordable housing programme that ended in 2021 it built 10,000 new homes in London but ‘this year in this programme we are bidding for 1,000. It is a dramatic drop.’
The economic inheritance of the next government will be so dire that it’s hard to avoid thinking that the prospects for housing investment will be even worse.
Take an already inadequate Affordable Homes Programme, add higher costs for construction, building safety, decarbonisation and follow the freeze on capital investment implied in current spending plans and you seem to have a recipe for housing disaster.
However, an important chapter in the latest UK Housing Review challenges that view on two important levels.
Glen Bramley builds on his longstanding work on housing need by essentially looking through the other end of the telescope at different scenarios for total completions of new homes in 2031 (ie after market conditions have recovered from the cost of living crisis etc).
His ‘low’ scenario corresponds with actual performance recently while ‘very low’ takes account of the current economic climate and recent changes in government planning policy that will reduce supply still further.
As the graph shows, under the ‘low’ scenario, there would be just 211,000 completions per year by 2031, with around 66,000 affordable homes including 35,000 for social rent. ‘Very low’ cuts those numbers by more than 20 per cent to just 164,000 overall and 50,000 affordable including 24,000 for social rent.
Judged against those numbers, the other three scenarios look a long way off, especially the promised land of ‘High-medium’ and ‘High’, which correspond with Labour’s pledge of 1.5 million new homes over five years and longstanding calls for 90,000 social rent homes a year.
Originally written as a column for Inside Housing.
It was meant to be a ‘housing moment’ that would make a home ownership-based pitch to younger voters.
That was the line briefed repeatedly to the Sunday papers in the run-up to a Budget that will probably be the last before the next election with the Conservatives 20 points behind in the opinion polls.
On new homes, chancellor Jeremy Hunt did have some minor funding announcements for specific schemes that seemed to stretch the definition of ‘levelling up’ to include Cambridge and Canary Wharf. He also boasted that ‘we are on track to deliver over one million homes in this parliament’ without mentioning the more ambitious manifesto target of 300,000 new homes a year.
The ‘moment’ was never going to be about social housing or homelessness. There was a small relaxation of the rules on using capital receipts by local authorities and a six-month extension of the Household Support Fund, but the Budget included none of the measures called for by Matt Downie of Crisis in his piece for Inside Housing last week.
Worse still, the Budget constrains the options for the spending review that will follow the election even further.
Originally written as a column for Inside Housing.
The prospects for housing investment look bleak whoever wins the election – and that is looking on the bright side – but there was an interesting comment this week from the frontrunner to be the next prime minister.
The Autumn Statement found money for tax cuts from an implausible sounding freeze in future capital investment and squeeze on departmental budgets after 2025. This seems designed both as a pre-election bribe and as a trap for Labour.
Labour leader Keir Starmer duly refused to fall into it in a speech at the Resolution Foundation think tank in which he said that anyone who expects the party ‘to quickly turn on the spending taps’ if it wins power will come away disappointed.
That will trigger bad memories for anyone who can remember the early years of the last Labour government, when Tony Blair and Gordon Brown pledged to match Conservative spending plans in its first two years.
That was disastrous for the social housing budget since those plans included deep cuts that seemed unrealistic even to the outgoing Tories.
Originally written as a column for Inside Housing.
If the polls are anything like accurate, there will be a Labour government next year. What did what could be the party’s last conference before the election tell us about its plans for housing?
There seemed to be genuine excitement at packed fringe meetings at the prospect of meaningful reform of renting and leasehold if (when?) the government fails to deliver. Potential future ministers are well aware of the key issues they will face and there was loud applause inside the main hall, especially when council housing was mentioned.
Keir Starmer’s ‘we are the builders’ speech on Tuesday ticked all the right boxes on housing supply and planning reform and he became the first potential prime minister to declare himself a Yimby.
However, the conference still left some big questions about the prospects for real change.
Originally written as a column for Inside Housing.
Inflation is starting to fall at last but the chances are what you pay for your housing has gone up along with the cost of everything else.
But this week’s inflation figures got me thinking about what we really mean by ‘inflation’ and how rising prices work differently in different tenures.
For starters, it all depends on the measure you use. The Consumer Price Index (CPI) is the one in the Bank of England’s inflation mandate so it matters most to its decisions on whether to raise interest rates or not.
CPI inflation affects the Bank’s decisions on interest rates which in turn drives mortgage rates so it is good news that it fell to 6.7 per cent in the year to August. However, CPI does not include owner-occupiers’ housing costs and it is not the index favoured by the Office for National Statistics (ONS).
If you’re not confused yet, on the ONS’s favoured measure of CPIH (which includes owner-occupier housing costs and council tax) inflation fell to 6.3 per cent in the year to August.
However, those costs are based on an estimate of the equivalent rents that owner-occupiers would be paying. There may be sound economic arguments for excluding rising asset values from the inflation calculation but rising house prices still mean rising housing costs for home owners that are ignored.
Old-style Retail Price Index (RPI) inflation – also falling but still considerably higher at 9.1 per cent – is the only measure that directly includes mortgage interest payments but is seen as less accurate than CPI and is no longer treated as on official statistic by the ONS. Despite that, RPI is still used to set price increases in some leases.
For all the differences between the three measures, it does seem clear that rising costs for renters and owners are playing an increasingly important role in inflation in household costs as the impact of the huge hikes in gas and electricity prices starts to recede. This ONS graph illustrates that only too clearly:
But what is really happening to house prices and rents? It all depends on who you believe.
Jules Birch 