We start 2020 in new territory, a Tory government with a substantial majority, in power for the next five years, but what does this mean for Estate Agents, Lettings Agents, Landlords and the whole Housing Market as we move forward?
I thought in this first newsletter of the year that I’d take a look at the pledges that this government made when electioneering regarding the Private Rental Sector, house building and much more.
The Conservative manifesto contained several pledges with the regard to the UK Housing Market:-
To build at least a million homes over the next five years
Extend the housing association Right to Buy pilot currently being run in the Midlands to other areas of the country
Renew the Affordable Homes Programme in the Spring Statement
Introduce ‘First Homes’, which will be sold at a 30% discount to First-Time Buyers
Ensure that local infrastructure, such as GPs and schools, are in place before embarking on new housing developments and give local communities the power to write design standards
Continue the commitment to Theresa May’s promise to end No-fault Evictions
A new market for ‘lifetime’ fixed-rate mortgages, which will include 5% deposits
‘Lifetime’ deposits for the Private Rented Sector, allowing renters to move the same deposit to a new tenancy when moving home
To simplify Shared Ownership by setting a single standard for all Housing Associations
An “accelerated” green paper on planning, aimed at speeding up the planning process
Reforming the Housing Infrastructure Fund to provide greater flexibility to ‘Homes England’
This pledge continues along the same lines as those promised by former governments, to increase the number of properties available with particular emphasis being given to ‘affordable housing’. However, whether this goal will be reached remains to be seen, as previous governments have failed to reach the targets that they have set.
Amber Valley has seen a number of New Build sites spring up over the past few years and all have seemed very popular with buyers. Most sites have also offered special deals for First Time Buyers, which have helped many local people get onto the property ladder. Some of the sites proposed however, met with opposition from local community groups and there is continuing concern throughout the Amber Valley region regarding building on designated green belt areas and the pressure that new developments will put on the existing local infrastructure.
From the introduction of a ‘lifetime’ deposit that moves with a tenant to the scrapping of Section 21 notices to encourage greater security of tenure, there are a wide range of policies being proposed that will affect Buy-To-Let landlords.
The scrapping of Section 21 notices continues to be of concern to landlords and property professionals alike, with some landlords choosing not to continue investing in the residential rental sector at all, and others choosing to move into the Holiday Let or Serviced Let property sectors. Property professionals have reservations regarding what changes will be made to the current Section 8 notice in order for it to work effectively and efficiently.
We are yet to find out exactly how these two new propositions would work in practice.
First Time Buyers
To help support First-Time Buyers, the Conservatives have promised to build 29,000 homes at 30% market discounts for local people who cannot otherwise afford to buy in their local area, simplify Shared Ownership and Help to Buy loans until 2023, and to introduce a new market in long-term fixed rate mortgages, with just a 5% deposit.
Whilst Help to Buy and Shared Ownership initiatives may have had critics over the past few years, they have proved very popular with First Time Buyers.
Talking with other property professionals, there is no doubt that the Housing Market has been subdued over the past few years with many buyers and sellers putting their property plans on hold, largely due to the uncertainty attributed to the lack of clarity on Brexit and if/when we would leave the EU. Many property professionals are hoping that a majority government in parliament will bring a much needed boost to the Housing Market in 2020.