The battle to build a million new homes

The Conservatives aim to increase the supply of new housing for all tenures to 300,000 a year by 2025, with a total target of 1 million by the mid-2020s. Labour with its commitment to create a Department of Housing has pledged to deliver a million new social homes over the next decade, achieving at least 150,000 homes a year by 2025. 

Labour’s plans to solve the housing crisis entail radical government intervention delivered through councils and housing associations with a focus on increasing the supply of social rented housing. The Conservatives meanwhile are committed to continue the supply of affordable housing, with greater emphasis on policies to support home ownership.

The Conservatives have not deviated greatly from current housing policy. They will continue to supply new housing through a mix of arrangements, including using private developers' contributions through the planning process to provide more discounted homes to buy for key workers; some form of Help to Buy post-2023; and government subsidy for low cost housing by renewing the affordable homes programme. 

There isn't the same focus on radical intervention by government to increase the number of houses built for social rent. Neither do they suggest changing linking affordable rents to 80% of market rent. Labour aims to link affordable rents to income levels.

In terms of deliverability, Labour plans to create an 'English Sovereign Land Trust' to buy land cheaply for low cost housing. It also intends to tax developers who fail to build out housing schemes and make public bodies use surplus land for building, rather than selling. This should speed up housebuilding, but could impact on land values and there is still the question of a complex planning process hampering delivery.  

The Conservatives' approach is less interventionist. They will continue to work with private housebuilders to capture uplift in land values to provide new infrastructure and housing. This is supported by some government subsidy with the new Single Housing Infrastructure fund. They plan to simplify the planning system for the public and small builders and support modern methods of construction. This approach has already been tested and to a degree works but, some would argue not quickly enough.

Labour's radical plans for council housing could have a significant impact on the wider property sector. The amount of funding and personnel that councils will need to deliver such a significant programme quickly is considerable. 

In recent years, councils have become more adept at creating partnerships to regenerate areas and increase the supply of affordable housing. Faced with the new duty to increase housebuilding, they will need to ramp up their development departments and internal expertise (or set them up from scratch) and expand their planning teams. It may be a challenge for councils to afford this additional resource without some extra financial support. 

There is a marked difference in the approach to home ownership with the Conservatives maintaining Right to Buy for council tenants and reinvigorating the Voluntary Right to Buy settlement with housing associations. Labour in its commitment to deliver more low cost homes for rent will abolish Right to Buy. Instead it is offering more low cost homes for first time buyers with prices linked to local incomes. It is not clear whether these will be built and sold by councils’ private developers or housing associations.

Housing is quite rightly at the heart of this debate and the impact of the result cannot be underplayed. With two very different approaches on the table, the result will have far reaching consequences, whichever way the electorate votes. 

This article was first published by 24Housing 

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