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Queen’s speech lacking on housing stock, planning reform and affordable housing – analysis

  • 10/05/2022
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Queen’s speech lacking on housing stock, planning reform and affordable housing – analysis
The Queen’s speech failed to address how the government would handle the lack of housing stock and how planning reform would be enacted.

Prince Charles, acting as the Queen’s consort, laid out the government’s legislative agenda for the upcoming parliament session, a tradition that dates back to 1963.

Planning system reform, along with reforms to the rental sector were among the 38 pieces of legislation mentioned, however, those in the property sector have said that further detail and clarification was lacking.

Stuart Law, chief executive at Assetz Group, said that a “notable omission” was the “lack of a clear and comprehensive approach to planning reform”.

He added that it was known that future legislation should include local design codes and reform as to how developers would contribute to community infrastructure, which could help “streamline and rationalise the process” and improve cashflow.

Law continued that it is vital that new developments are “sensitive to, and enhance local communities”, but local design codes could “add yet another hurdle for housebuilders to jump.” He also noted that high construction costs, the energy crisis, and long-term impacts of Brexit and Covid-19 were already negatively impacting housebuilders, so redundant legislative barriers need to be removed so it’s not “harder for them to grow their business”.

However, he believes that SMEs are “best placed” to navigate the local design code system due to their unique local knowledge and experience.

Law said that Assetz would have to wait and see what future legislation looked like, but it doesn’t look like reforms will be “nearly radical enough, or being progressed with enough urgency, to help tackle the major challenges housebuilders face, or deliver significant numbers of new homes to meet demand and moderate price growth”.

He added that if issues are not tackled more comprehensively then current market dynamics would become “unsustainable” as people are locked out of the housing market and the number of SME housebuilders could continue to fall.


“A perverse game of cat and mouse” for first time buyers

Karen Noye, mortgage analyst at Quilter, said that whilst there are some plans to address the housing and rental market, none of them “truly tackle the root cause the problem”, which is lack of housing stock.

She explained that first-time buyers had been “playing a perverse game of cat and mouse” over the last few years as they struggled to save a deposit due to rising rent and house prices.

“This ultimately pushes prices up as people scramble for property, and the only cure is a radical house building plan that enables people to buy good quality homes at a fair price that stand the test of time,” Noye noted.

She praised government’s actions to abolish Section 21 Notices and improve the condition of rented housing stock, but said it did not go far enough.

“Fixing the rental market is needed and understandable but is a sticking plaster that fails to address a much larger problem.

“Ultimately, we need to help more people get their first foot on the property ladder so they can build up equity and enjoy some of the wealth creation opportunities that generations before have enjoyed from housing,” Noye said.

“Crying out” for clarity on affordable housing

Jeremy Leaf, north London estate agent and former RICS residential chairman, added that the industry had wanted further clarity on affordable housing and whether its provision would improve.

“The industry is crying out for this, as well as more transactions, which are good not just for the property industry but the wider economy,” he said.

He added that the sector wanted “clearer direction” for bringing empty homes back into use.

Secretary of state for the Department for Levelling Up’s Michael Gove has previously said he would give local leaders the ability to force landlords out of empty shops to revive the high street.

Leaf continued: “The comments regarding planning are welcome but the test will be in the delivery, whether small and medium-sized builders in particular don’t feel marginalised and have a good chance of obtaining planning consent reasonably quickly.”

He added that he would have welcomed more “encouragement for energy efficiency in properties for rent and sale.”

The legislation, which is yet to be ratified, will mandate that existing rental tenancies have to get an Energy Performance Certificate (EPC) of C or higher by 2025, and new tenancies will need to reach the same bar by 2028.

However, there is still a lack of clarity as to when the legislation will come into effect, with the draft deadline set to be extended from 30 April 2025 to 31 December 2025, and a further extension to 2026 expected.

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