October 2019
By Paresh Raja, CEO, Market Financial Solutions
The somewhat controversial 2019 Queen’s Speech saw Boris Johnson’s government announce a raft of policy proposals in big-ticket areas. Sure to catch voters’ eyes, more spending on health, crime and education proved to be the order of the day. After years of the Conservative Party refraining from making bold spending commitments, this could turn out to be a wise electoral move for Boris Johnson and his government.
What was neglected in the Queen’s speech, however, were the interesting housing policies that have been emanating from both the Conservative Party and different departments of the government over the past 18 months. At the former’s conference in September, Housing Secretary Robert Jenrick announced the creative “up, not out” initiative. It aims to loosen property planning regulation to allow those living in towns and cities to build additional stories on their homes without obstructive interference from council red-tape.
And they’re not just promising policy reform; Chancellor Sajid Javid also vowed infrastructure investment – including a roads package worth £29 billion – to ensure that new-build developments are better connected and aid in the overall regeneration of regional Britain.
These are the kinds of confident plans that would benefit prospective home buyers in a tangible way. After all, emboldening all kinds of buyers is vital to keep the property market dynamic.
But, for two reasons proposed government reforms are at risk of getting off to a false start.
First, they might be mothballed in the frenzy of Brexit and by Boris Johnson’s laser-focus on health, crime and education.
Second, and perhaps more importantly, the government’s overall housing policy lacks coherence. The broad aim to ‘build more’ is right, but internal inconsistencies show policies haven’t been thoroughly strategised. The earlier mentioned “up, not out” initiative, for example, has the potential to free-up developers, homeowners and property investors to build more living space.
But the government has also announced new design guidelines in England as part of its ‘Building Better, Building Beautiful’ inquiry. These call on developers to construct developments which appeal to traditional and nature-inspired aesthetic tastes. The challenge is determining how these recommendations are enforced.
Fragmentation of government policy is problematic but not damning. The individual policies contain some appealing prospects: serious investment, creative reform and the relaxation of development restrictions. What we need is a strategy that effectively links these all up into one coherent narrative.
Looking beyond Brexit, the next big date in the political calendar is the highly anticipated 2019 Autumn Budget. Scheduled to take place on 6 November, this will be the ideal platform for the government to convert many of its proposed commitments into legislation. For property investors, Boris Johnson’s touting of major reforms to Stamp Duty Land Tax could ensure more people are able to jump on and move up the property ladder, free of the some of the financial constrains that could be holding them back.
As such, I hope the government uses the 2019 Autumn Budget as an opportunity to address the challenges facing the housing market. We need to see vision and leadership that is not just fixated on Brexit, but also acknowledges some of the pressing domestic challenges currently facing the UK.