Changes to housing policy under Labour

As Labour won the July 2024 election in a landslide victory, following 14 years of Conservative government, sectors across the UK can expect to see significant transformation. The UK housing market is likely to see some substantial changes in the coming months and years, as Labour’s manifesto has outlined ambitious plans to address the current housing crisis, aiming to tackle key long-standing issues of affordability, quality, security, and sustainability. 

Here’s what you need to know about the new Labour administration and how it might affect the wider property sector. 

Key figures

Angela Rayner, Deputy Prime Minister, has also been appointed the Secretary of State for the Department of Levelling Up, Housing and Communities. Under the previous Conservative government, she was shadow Housing Secretary from September 2023 to July 2024.

During last year’s Labour Party Conference, Rayner pledged to create ‘the biggest boost in affordable and social housing for a generation’. She has also stated her intention to ban Section 21, or ‘no-fault’ evictions, ‘immediately’ but has not yet laid out a clear plan of how she intends to do this. 

Working under Rayner, Matthew Pennycook has been appointed Housing Minister. Having served as MP for Greenwich and Woolwich since 2015, Pennycook has experience within the housing sector and has worked closely on the Renters Reform Bill. He tabled amendments to the suggested bill which would prevent landlords from selling a property for two years after a tenancy. In 2023, he also expressed that he would like to see the Regulation of Property Agents (RoPA) implemented. 

How does Labour’s manifesto intend to address the housing crisis?

Addressing the housing shortage

The new Labour government has recommitted to its manifesto promise of building 1.5 million homes over the next Parliament to try to tackle the long-standing housing shortage in the UK. However, housing associations and councils fear that Labour will miss this target if an emergency cash injection is not given to the affordable housing sector.

Expanding social housing

Labour has committed to the biggest increase in social and affordable housing in a generation, a move designed to provide more affordable and secure housing options for those on lower incomes and decrease reliance on the private rental sector. 

They intend to strengthen planning obligations to make sure more affordable homes are included in new developments. They also intend to make changes to the Affordable Homes Programme so that more homes can be delivered from existing funds and resources. Labour will also continue to increase protections on new social housing. 

Rental sector reform 

Labour’s manifesto lays out a series of measures designed to protect tenants and their rights. They plan to abolish Section 21 ‘no fault’ evictions, a decision intended to provide more security for renters. They also intend to place additional protections which prevent bidding wars for rental properties and cap upfront rent requests or payments. 

Labour has also pledged to extend Awaab’s Law, which currently applies to social housing, to the private rented sector. Awaab’s Law is currently part of the Social Housing (Regulation) Act 2023. It requires landlords to investigate damp and mould concerns within 14 days of being made aware and begin repair works within seven calendar days if there is a hazard uncovered that could pose a significant health or safety risk to the tenant. Extending this to the private rented sector would protect more renters from mould-related issues. 

Promoting sustainable housing

Labour is aiming to lower energy prices and reduce the carbon footprint of the housing sector by introducing a series of measures to improve energy efficiency in rental properties. They intend to enforce that all rental properties must have an EPC rating of C or above by 2030.

Supporting first-time buyers

Labour aims to help 80,000 young people get on the property ladder in the next five years. They plan to introduce a permanent mortgage guarantee scheme, known as the Freedom to Buy Scheme, which would help those struggling to save for a large deposit. They also intend to offer local people first choice on new developments and tax foreign buyers to try and prevent entire developments from being sold to international buyers who may be able to price out locals. 

Community regeneration 

Labour’s housing policy is strongly centred around community regeneration, with plans to invest in neglected urban areas by improving infrastructure, green spaces, and public services. Labour plans to allow local communities to have a say in shaping housing projects, and allow them intervention powers if developments are not meeting the needs of local people.

Labour intends to work with local leaders to address housing shortages sustainably by building large-scale new communities. 

A new era for UK housing?

Labour’s suggested housing policies present the property sector with a lot of opportunities for growth and expansion, particularly in the prioritisation of affordability, quality, and sustainability. 

We will see the impact of these suggested reforms as the new Government continues to implement changes in the coming months.