New Labour Policies For Property Investors

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With the Labour Party now leading after 14 years of Conservative rule, the UK is set for major changes in the housing sector. Labour’s housing plan aims to address issues of affordability, security, and quality. Here are some of Labour’s key housing policies.

Who will be in charge of housing?

Matthew Pennycook has been appointed as the new Housing Minister, a move that was widely expected. Re-elected as the MP for Greenwich and Woolwich with a majority of over 18,000 votes, Pennycook has a strong background in housing policy, having served as the Shadow Housing Minister since 2021. He will be working under Angela Rayner, who was confirmed as Secretary of State for Housing, Levelling Up and Communities on 5th July.

Pennycook has been actively involved in housing policy, including detailed work on the Renters (Reform) Bill, despite the bill not passing due to the early General Election. His experience and commitment to housing reform make him a key player in the new government’s housing plans.

So, what are Labour’s housing policies now that they are in power? Here’s a summary of their key plans.

Rental sector reforms

Abolition of Section 21 Evictions: Labour plans to immediately abolish Section 21 ‘no fault’ evictions to offer renters greater security and prevent arbitrary evictions, ensuring a more stable living environment.

Crackdown on Unscrupulous Landlords: The party aims to end bidding wars, cap upfront payments, and require rental properties to achieve an EPC rating of C or above by 2030. These steps are intended to protect tenants and enhance rental property quality.

Improving Energy Efficiency: Labour’s policies will enhance energy efficiency in rental homes, potentially saving private renters £250 annually.

Tenant Protections: New measures will stop the auctioning of rented homes and cap upfront rent payments. These changes aim to prevent exploitation and discrimination, ensuring fair treatment for tenants.

Raising Standards: Extending Awaab’s Law will raise standards in the private rental sector, protecting tenants from poor living conditions.

Support for first-time buyers

First-Time Buyer Priority: Labour plans to focus on first-time buyers by giving them priority to purchase homes, aimed at helping more people enter the property market.

Mortgage Guarantee Scheme: A permanent Mortgage Guarantee Scheme will be introduced to assist those facing challenges with large deposits and to lower mortgage costs, making homeownership more attainable.

Building 1.5 million new homes

National Policy Planning Framework: Labour will quickly update this framework to reverse previous changes and reintroduce mandatory housing targets, aiming to ensure a steady supply of new homes.

Support for Local Authorities: Extra funding and support will be provided to local planning authorities to help them keep their Local Plans current and enforce them strictly.

Planning Officers: More funding will be allocated to planning officers, along with a higher stamp duty surcharge on non-UK residents.

Community Involvement: Local communities will have a role in shaping housing projects, with intervention powers used if necessary to ensure developments address local needs.

Brownfield development and greenbelt protection

Brownfield-First Approach: Labour will focus on developing previously used land first, speeding up projects on urban brownfield sites to reduce environmental impact.

Greenbelt Strategy: Labour will release lower-quality ‘grey belt’ land with regulations that ensure benefits for both communities and the environment.

New Towns and Urban Extensions: Labour intends to create large new communities with local leaders, aiming to address housing shortages sustainably.

Strategic planning for housing growth

Cross-Boundary Planning: New methods will be implemented for strategic planning beyond local levels, ensuring coordinated development across regions.

Empowering Authorities: Combined and Mayoral Authorities will be required to plan for housing growth and will receive support to enhance regional development.

Compulsory Purchase Reforms: Labour will update land acquisition processes with fair compensation rules to streamline the development of new housing projects.

Social and affordable housing

Social Housebuilding Increase: Labour plans to significantly boost social and affordable housebuilding, aiming to tackle the severe shortage in these types of housing.

Strengthening Planning Obligations: New regulations will be introduced to ensure that more affordable homes are included in new housing developments.

Affordable Homes Programme: Adjustments to this programme will make better use of existing funds to increase the number of affordable homes available.

Protection of Social Housing: Labour will review right-to-buy discounts and enhance protections for new social housing to preserve the stock of affordable homes.

High-quality, sustainable development

Exemplary Development: Labour aims to make high-quality, well-designed, and sustainable homes standard in future developments.

Climate Resilience and Nature Recovery: New housing projects will focus on enhancing climate resilience and supporting nature recovery to meet environmental targets.

Nutrient Neutrality: Labour will introduce measures to enable homebuilding while maintaining environmental protections, ensuring growth is balanced with sustainability.