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UK policy overview

Gavin Smart, Deputy Chief Executive, CIH


The economic and fiscal context

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Economic context


A drawn out recovery


Debt and austerity


Future government spending


Govt Spending reductions


Budget 2015 “roller coaster”


Public Spending implications• IFS est coalition plans need £30bn of cuts by 2017/18• George Osborne breakdown

£12bn welfare £5bn tax evasion £13bn DEL spending cuts

• Poss that coalition plans need £35bn cuts So spending cuts could be £18bn

• Lib Dems £12.5bn tax rises £3.5bnwelfare £10bn DEL cuts

• Labour balance the budget (less investment) and debt falling by 2015 £!8bn cuts or not?


Regional economic growth


Regional Economic Growth


The productivity challenge


Earnings


The housing context


Inadequate supply


Transactions down


Mortgage lending – slow growth


Affordability consequences


Homelessness consequences


The squeezed middle


Housing & the election


Where is housing for GE 2015?


Housing playing much more in 2015 than 2010


Housing and public opinion

• People (75% & 81% renters) and politicians (67%) believe there is a housing crisis

• 46% believe there is a housing crisis in their area (76% Londoners & 60% renters)

• Politicians believe government can do something about it (86%)

• 68% MPs believe building more homes that are affordable should be a top government priority


Homes for Britain


Ticking the box for housing


Post-election policy environment?


Manifesto commitments• Some common themes

Broad acceptance that state can/must play a wider role• Although v diff views about how and for what purpose• Guarantees vs direct commissioning vs borrowing for investment

Continued welfare reform• Including most likely retention of some sort of cap• Cap regionalisation• Further savings?

Bedroom Tax repeal or reform (except for Conservatives) Continued focus on home ownership/FTBers

• At the expense of other sectors?• Right to Buy, Help to Buy, First Time Buyer homes etc


Manifesto commitments

• Common themes New settlements/urban extensions More affordable housing (but v diff defintions) Degree of interest in capacity in council sector Reform of PRS (except for Conservatives)

• Minimum tenancy lengths• Tax changes• Action on agents fees


Manifesto commitments• All parties are still bigger on announcement than

details• There are questions for most of them:

How will Lib Dems get to 300k homes pa – is industry capacity there in the short term?

How does Labour use of Help to Buy ISA work? Does the Conservative extended Right to Buy really stack

up? How credible is the UKIP “brownfield revolution”? How will Greens fund 500k social homes by 2020? How will Plaid recycling of HB savings work?


Conclusions

• Economic recovery is underway• But how widely felt is it?• Housing system is still showing signs of stress• It will take long term action to address• Housing is an election issue• Being “an issue” is important• Action even more so


Conclusions• Consistency is critical

Creates confidence – crucial to increasing capacity Allows for long term planning

• There are encouraging signs…• …But across piece some way short of a complete

strategy• Housing crisis has been a generation in the making• It will require concerted long term action to fix• Can our politicians deliver?


Thank you

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Green Party manifesto• 500,000 sustainable social rented homes - increasing the social

housing budget from £1.5bn to £6bn pa during the Parliament• End Right to Buy and Help to Buy• Remove council borrowing caps• New homes to be built to Passivhaus standard• All PRS homes to meet energy performance band C by 2025• Devolve housing benefit budgets to councils• Abolish the bedroom tax• Keep housing benefit for under 25s• Bring HB in line with average market rents• PRS ‘living rent’ tenancy and cap rent increases• Mandatory licensing scheme for landlords


Liberal Democrat manifesto• 300,000 homes a year - HMT to directly commission if market

does not deliver• Increased capital investment in housing & publish a long term

plan within the first year• Build 10 new garden cities and encourage new garden villages• Review CPO legislation – enable site assembly & Garden Cities• Rent-to-own scheme - ownership through paying rent• Multi-year tenancy with inflation-linked annual rent increases• Consider banning letting agent fees• Help to Rent - government backed deposit loans• Reform bedroom tax & HB direct in return for reduced rents


UKIP manifesto• Abolish the bedroom tax• Lower the benefit cap• Retain HB for under 25s• Bring empty homes back into use and 50% more

council tax on homes empty 2+ yrs• One million homes on brownfield sites by 2020• Local people final say on major planning

developments by referendum• Scrap the National Planning Policy framework• New planning guidelines prioritising brownfield sites

and protecting the green belt


Conservative manifesto• Extend the Right to Buy to 1.3m housing association tenants• Reduce the benefit cap from £26,000 to £23,000 a year• Cut welfare by a further £12 billion• Build 200,000 new starter homes for FTBers under 40• Introduce a Help to Buy ISA for first time buyers• Create a £1bn fund to unlock homes on brownfield land• Build 275,000 additional affordable homes by 2020• Double self-built homes by 2020 through Right to Build• Local brownfield land registers & ensure 90% of suitable

brownfield land is have planning permission by 2020• London land commission to identify brownfield land• Deliver 95,000 homes through new ‘housing zones’


SNP Manifesto

• UK wide target of 100k affordable homes per year

• Halt rollout of universal credit• Abolish the bedroom tax• Support help to buy


Plaid Cymru manifesto• Planning reform – local need & benefit – Welsh

language considerations• Rent controls• HB savings & additional borrowing for new social

housing• HRA subsidy reform to see rental income retained in

Wales• Extend Home Buy• Higher council tax for second homes• 12 month minimum PRS tenancy


Labour manifesto• House building to 200,000 pa by 2020 – implement Lyons • Create a Future Homes Fund funded by Help to Buy ISAs• ‘Use it or lose it’ planning powers• Support for smaller builders• Prioritise capital investment and ‘reform council house

financing’ – inc. through locally negotiated benefit savings• Build a new generation of garden cities• Abolish bedroom tax• Pause and review universal credit + revised benefit cap• PRS three-year tenancies+ rent rise ceiling – no agents fees,

register of landlords• Mansion tax on properties over £2m

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