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Housing shapes up as top priority in run up to General Election

April 2, 2015Article by Ray Withers

It’s no secret that Britain is in the midst of a housing crisis. We don’t have enough homes and we’re building at a rate that sees us fall further behind the target number each year. Given the situation, it is unsurprising that the UK’s political parties have included housing as one of their key policy items for the forthcoming general election.

A potted history

The UK’s housing crisis has been building for decades. It’s not just a matter of population growth, but one of civic change. Households today have fewer people in than they used to. With shifting family shapes, the demand for housing has far outstripped supply. New homes are being built, but at only around half the rate needed. A recent Homes for Britain rally saw 2,300 activists gather at Westminster to keep the issue in focus.

In recent months and years, the Help to Buy scheme has supported those struggling to get onto the property ladder to purchase a first home, while stamp duty reforms have made the purchase process cheaper for the great majority of homebuyers. The private rented sector is continuing to grow and house prices across the UK have stabilised since the crash back in 2006/07. Most recently, in a pre-election appeal to those unable to afford their own home, the Government has introduced both the Help to Buy ISA and a process for 100,000 first time buyers under the age of 40 to register to buy new homes at 20% off market price.

The pledges

Each political party has taken a firm stance on housing, agreeing that it is an important issue to solve. Labour and UKIP have both set a target of building 200,000 homes per year, while the Liberal Democrats have set one of 300,000. The Conservatives and the Green Party have said that it is up to local authorities and councils to determine building targets, though the Conservatives have promised 200,000 new starter homes by 2020.

The Conservatives plan to continue the current policies, but with the extension of Help to Buy equity loans to 2020. Their focus is on enabling more families to get onto the housing ladder, something that has become increasingly difficult over the past generation.

Labour is focused on doubling the number of first time buyers by 2025, tempting them with the promise of no stamp duty on the first home they buy and a scheme to move them to the front of the queue when purchasing new build homes.

Private renters are also firmly on Labour’s radar, with the party offering             three year secure tenancies, bans on letting agency fees and caps on rent increases, with private landlords unable to raise rents by more than the rate of inflation. The Greens are going one step further in their commitment to look at genuinely effective rent controls.

The Lib Dems have made rent-to-own a key policy, whereby tenants pay monthly payments for 30 years, at which time they take ownership of the property. The scheme would enable first time buyers to avoid the need to save a deposit, which is one of the main stumbling blocks for those who can afford a mortgage payment but have no savings. They have also pledged to build 300,000 new homes per year, in at least ten garden cities spread across the UK.

UKIP’s commitment is to build 1 million homes on brownfield sites by 2025, as part of the £1 billion brownfield revolution, while the Green Party’s focus is on building 500,000 affordable homes by 2020, with local councils able to borrow additional funds to achieve the target.

A burning issue

According to Ipsos Mori’s latest Issues Index, housing is ranked by 14% of voters as one of the most important issues that the UK faces. Back in 2010, the figure was just 5%. Clearly the political parties’ stance on housing could be a make or break one in the 2015 election and with so much pressure to make housing a success, one can hope that the certain winner of all of this will be the UK’s housing sector.

For more information on housing in the UK and to find out about leading UK buy-to-let investment opportunities, contact Property Frontiers or call +44 1865 202 700.

Author

Ray Withers

Ray has over 17 years’ experience in the international property market and bought his own first international property investment back in 2002. Aside from running Property Frontiers, Ray has been involved in residential, hotel, student and commercial property investment and development in both the UK and overseas and co-wrote "Where to Buy Property Abroad - An Investor's Guide". As Founder and Trustee of the Frontiers Foundation, Ray is directly involved with many of its projects to ensure they have a direct and tangible impact in individual communities across the globe. He is passionate about property, travelling, scouting out new opportunities and finding time to spend with his young family.
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