Housing sector

Leveling up… implications for the housing sector

Yesterday the government’s long-awaited white paper on ‘race up’ was released, discussing some of the geographical disparities and, importantly, the government’s proposed reform of systems and the policy agenda for the coming years to remediate. The definition of its medium-term political objectives, at the heart of this document (alongside priority areas such as health and the standard of living – in particular employment), focuses on improving the quality and availability of accommodation.

The government’s mission statement for housing is that “By 2030, tenants will have safe access to property, with the number of first-time buyers increasing in all areas; and the government’s ambition is for the number of non-decent rental accommodation to have fallen by 50%, with the biggest improvements in the worst performing areas.However, the response to the document has been muted at best – with many suggesting the document is “light” on details in terms of how it will be achieved and what it actually means in practice.

The lack of availability of housing stock, and in particular the shortage of supply, is a long-standing problem facing the UK. The government’s housing white paper (‘Fixing our broken housing market‘) identified this problem in 2017 and various promises (including in the current government manifesto) have since been made to increase housing delivery by 300 000 per year. To date, this objective has not been achieved. So, does the Leveling Up document explain how its mission statement will be achieved?

Although the document is understandably lacking in detail, there are several positives for the market. Looking to Homes England to help local authorities provide new housing and for the local government pension scheme to increase investment in local housing is a start. However, government recognition of some of the issues facing the market, including the critical need to address issues in the planning system and in markets outside of private property and social housing, is potentially more important.

The government will publish another white paper in the spring on the PRS market and has promised a task force on elderly housing with, presumably, a particular focus on retirement living; both of which are market segments that arguably have not received enough attention from the government to date. Constituting a substantial and growing part of the sector, each with the potential to unlock housing shortages, as new proposals are announced (whether through the Supplemental White Paper or as the scope, allocations and task force results become clear), it could be a real boost to these asset classes.

Getting people onto the housing ladder means making housing more affordable now and in the future. The UK government will continue to work towards our ambition to deliver 300,000 new homes a year in England by the mid-2020s to create a more sustainable and affordable housing market.