What a Labour government means for you

Ahead of the election, Keir Starmer promised to ‘hit the ground running’ and turbocharge housebuilding from ‘day one’, to deliver on Labour’s housing manifesto. Now that Labour is in government, we will be updating this piece as announcements are made. Sign up to our newsletter to stay up to date with latest news, and read on for what has been promised to date.

Plans to ‘get Britain building’ were formally announced in the King’s Speech on 17 July as the new government seeks to ‘accelerate the delivery of high quality infrastructure and housing’. At the same time draft legislation was promised on leasehold and commonhold reform. While for those renting their home, legislation will be introduced to give them greater rights and protections, including ending no fault evictions and reforming grounds for possession.

This was followed on 30 July 2024 by an announcement from Angela Rayner, Housing Minister, that mandatory housing targets for England, which were scrapped by the previous government last December, would be restored.

Labour’s housing promises

1. Housebuilding

A new annual target for house building has been introduced, and increased from 300,000 homes to just over 370,000.

Angela Rayner announced the government is changing the method used to calculate how many houses are needed in an area “so we better reflect the urgency of supply for local areas”. As a result, the target for London has been lowered from the previous 100,000 to about 80,000.

The new rules will also require 50% of new housing to be affordable with a focus on social rent. And £450m of the local authority housing fund will go to councils to provide 2,000 new homes.

A new Planning and Infrastructure Bill will be introduced, which seeks to accelerate the delivery of high quality infrastructure and housing, by improving planning systems at a local level, modernising planning committees and increasing local planning authorities’ capacity to deliver an improved service.

We think building targets are key to encourage local decision makers to drive through housing plans in the face of NIMBYISM. The government quite rightly said, ‘The planning system must be an enabler of growth – enabling democratic engagement with how, not if, homes and infrastructure are built’.

The Housing Minister said the reforms will make explicit that brownfield development should be “the first port of call” and said they will promote higher density homebuilding in urban centres.

She said some low-quality green belt land would be freed up for construction under the plans – and a new definition of what constitutes low-quality green belt land would be provided.

There will be a requirement for developers to provide money for supportive infrastructure such as schools, GP surgeries and transport links as well as improvements to accessible green space.

While this is already a requirement on developers, the Housing Minister said it will address “the previous government’s haphazard approach to building on the green belt that has seen so many of the wrong homes built in the wrong places without local services that people need”.

Local authorities will also have to review their green belts to meet housing targets.

Our Chief Executive Paula Higgins commented that,

“We welcome reforms to the planning system and to increase capacity in local planning departments. However, this isn’t the first time a government have promised planning reforms and a new slicker system. Only time will tell if these reforms will be enough to make a dent in the housing deficit accrued over the last 30 years.”

“We also welcome the government’s promise to introduce a National Housebuilding Strategy so we have the vision, detail, milestones and targets for delivering more homes. This was one of the key things we called for ahead of the General Election.”

2. More social housing and affordable housing

The new Labour government has vowed to deliver ‘the biggest increase in social and affordable housebuilding in a generation’. Plans relating to affordable housing are also addressed in the Planning and Infrastructure Bill, with its proposal to ‘further reforming compulsory purchase compensation rules to ensure that compensation paid to landowners is fair but not excessive where important social and physical infrastructure and affordable housing are being delivered’.

The government says these reforms will help unlock more sites for development, ‘enabling more effective land assembly, and in doing so speeding up housebuilding and delivering more affordable housing, supporting the public interest’.

On 30 Jul, the Housing Minister referred to their plans as a “council house revolution” with the “biggest boost to social and affordable housing in a generation”. Further details will be revealed in the Autumn Budget on 30 October.

We can also expect at about that time a consultation on changes to the Right to Buy scheme to protect the nation’s social housing stock. This will include a review of the Right to Buy discounts people can get to buy their homes, eligibility criteria and how councils use the money they receive from Right to Buy sales.

3. Leasehold flats will be banned

Leasehold reforms finally made it into law this year under the previous Conservative government after it acknowledged the leasehold system was outdated and unfair. In the Kings Speech the new government committed to implement the Leasehold and Freehold Reform Act 2024 so that leaseholders can benefit from more rights, power and protections over their homes.

The Government also said it will take steps to bring the feudal leasehold system to an end, reinvigorating commonhold through a comprehensive new legal framework and banning the sale of new leasehold flats so commonhold becomes the default tenure.

To this end, a draft Leasehold and Commonhold Reform Bill will be introduced. This will include:

• Reinvigorating commonhold by modernising the legal system, to bring the feudal leasehold system to an end and restrict the sale of leasehold flats. This will involve a consultation.
• Tackling existing ground rents by regulating ground rents for existing leaseholders so they no longer face unregulated and unaffordable costs.
• Bringing the injustice of ‘Fleecehold’ private estates and unfair costs to an end
• Ending the injustice of forfeiture.
• Enacting remaining Law Commission recommendations to bolster leaseholders’ fundamental rights to extend their lease and buy their freehold (enfranchisement), and take over the freeholders building management functions (Right to Manage).

We welcome these announcements. The 2024 Leasehold and Freehold Reform Act needs to implemented as soon as possible and we are pleased to see a new Bill addressing the remaining areas in need of reform. Read more about current Leasehold Reforms.

The issue of ‘Fleecehold’ impacts so many families in particular. Fleecehold refers to the increasingly common practise of buying a house with a combination of freehold and leasehold terms. It usually means you own the land, but you have to pay onerous annual or monthly fees to a third party to maintain it and is arguably the next big housing scandal. You can see the strength of feeling from the almost 1000 comments we have received on our estate charges guide. The government will consult on how to do this but in our view, the first step in remedying this situation will be to make it mandatory for all future new build estates to be adopted by local authorities and to ban all future estate rent charges.

4. Renters’ Rights

The government has also announced the Renters Rights Bill which includes proposals such as abolishing Section 21 ‘no fault evictions’, new clear and expanded possession grounds will be introduced so landlords can reclaim their properties when they need to and applying ‘Awaab’s Law’ to the sector, setting clear legal expectations about the timeframes within which landlords in the private rented sector must make homes safe where they contain serious hazards.

There are some concerns that while the Renters Rights Bill is welcome in it’s efforts to improve private rented sector quality with the Decent Homes Standard, as well as abolishing assured short tenancies and no fault evictions, there may be some unintended consequences on the housing market.

Rents continue to rise. The average rent increased to £1,310 (8.6%) in England in the 12 months to June 2024, according to the ONS as demand outstrips supply. But the new laws could mean more private landlords leave the sector. Recent TwentyEA data shows a significant uplift in the number of landlords selling up. In June 2024, 18.4% of all properties listed for sale had also been listed for rent within the three years prior to the sale listing. This was 100.6% higher than in June 2023.

Chris Norris, policy director for the National Residential Landlords Association, has said: “With an average of 15 households chasing every available home to rent it is vital that rental reform does not make an already serious supply crisis in the private rented sector worse.

“The system that replaces Section 21 needs to be fair, workable and sustainable for both responsible landlords and renters. That means fixing a broken justice system which too often fails those reliant upon it.”

What about first time buyers?

Before the general election, Labour pledged to ‘work with local authorities to give first-time buyers the first chance to buy homes’ so they’re not sold off to international investors before they’re even built. We support this move but wonder how it will be implemented so as not to undermine the house building target. We look forward to seeing the detail on this.

It has also promised to launch a permanent Freedom to Buy mortgage guarantee scheme. Though it’s not clear how it will differ from the current mortgage guarantee scheme and what the real impact will be. You can read what we do know about the Freedom to Buy scheme here.

Labour’s manifesto at a glance

Here’s an overview of Labour’s election housing manifesto promises.

House-building	Restore mandatory house-building targets immediately. Pledge to build 1.5 million new homes during term.
Planning reform	Take tough action to ensure planning authorities have up-to-date Local Plans and strengthen the presumption in favour of sustainable development. Fund additional planning officers.
Green belt	Will take a brownfield-first approach. Committed to the green belt and will take a strategic approach.
First time buyers	Launch of a permanent mortgage guarantee scheme. First time buyers will get chance to buy homes before international investors.
Renters	Will overhaul the regulation of private rented sector and immediately abolish Section 21 ‘no fault’ evictions, empower them to challenge unreasonable rent increases, and raise standards.
Energy efficiency	Plan to double investment (an extra £6.6 bn) to upgrade 5 million homes. The Warm Homes Plan will offer grants and low interest loans for insulation, solar panels, batteries and low carbon heating to cut bills.
Building safety	Will take “decisive action” to improve building safety through new regulation.
Leaseholders	Will enact Law Commission proposals on leasehold enfranchisement, right to manage and commonhold. Will ban new leasehold flats and ensure commonhold is the default tenure. Promises to review how to better protect leaseholders, including tackling unregulated and “unaffordable” ground rent charges.
Fleecehold	Will bring the injustice of ‘fleecehold’ private housing estates and unfair maintenance costs to an end.
Stamp duty	Will increase the rate of the stamp duty surcharge paid by non-UK residents
New towns	Will build a ‘new generation of new towns’
Social and affordable housing	Will deliver the biggest increase in social and affordable housebuilding in a generation.
Right to Buy	Will review the increased Right to Buy discounts introduced in 2012
Capital Gains Tax	Will not introduce capital gains tax on private homes, but will close the loophole “where private equity is the only industry where performance related pay is treated as capital gains.”
Homelessness	Will develop a new cross-government strategy, working with Mayors and Councils across the country, to put Britain back on track to ending homelessness.

What else the Labour government needs to do

However, there are important issues that Labour has not yet addressed. These are topics we’ll continue to campaign on:

Stop homebuying and selling chaos

Anyone who has bought and sold a home knows the process has some major faults. For the past 7 years, the Conservative government investigated and consulted on reforms from the Regulation of Property Agents and the role that reservation agreements could play. But there has been very little action and we continue to see transaction times taking longer, more sales collapsing and homebuyers and sellers paying huge costs without even having bought somewhere to live.  We will continue to lobby for change.

Scrap Stamp Duty

We want the Labour government to scrap stamp duty. In our 2013 Stamping on Aspiration report, (yes, over a decade ago!) we reported on the astonishing impact the effect stamp duty was having on the housing market and called for a series of reforms.

If you’re buying a home to live in you shouldn’t have to pay this tax on mobility.

It’s a tax that puts off families from moving up the property ladder, fleeces homeowners needing to make a sideways move and makes it more expensive for older generations to downsize.

It’s a tax that is applied every time a property is bought and sold. As a result people are choosing not to move. This inactivity limits the number of properties to choose from when buying in an already squeezed housing market. And the knock on effect of all these lost home moves percolates through the whole economy – with everyone from property services like removals firms, to furniture sales, to tradespeople missing out.

(We do however continue to support the 3% surcharge on buy-to-let and second homes, and the 2% surcharge for non UK residents). Find out more in our Scrap stamp duty campaign.

Build Better New Builds

People having more rights if they buy a toaster than if they buy a house.  We’ve been saying it for 12 years. But very little has changed.

Britain needs more houses, but building standards and quality need to be upheld. New homes need to be built in the right places, and meet the basic needs of homeowners. We hear of far too many nightmare new build stories – which even Ministerial involvement can’t solve – after they are sold to unsuspecting people parting with hundreds of thousands of pounds. We need to get new builds built right.

We would like to see:

• A minimum of a 2.5% snagging retention – so that new build homebuyers retain at least 2.5% of the cost of the house, which would only be paid after 6 months. This creates a powerful incentive for builders to put problems right, rather than leaving the homeowner in the lurch. If things aren’t put right, or if the homeowner wants to sort them out themselves, then their costs should be deducted from the 2.5%. Such snagging retentions are common practice with extensions and commercial clients of housebuilders, but are not available to new home buyers. Read more about how a snagging retention could work here. 
• A New Homes Ombudsman Service with teeth – created to mediate disputes between new home buyers and their developers. The current Ombudsman and its code of practice remain voluntary rather than mandatory. And the system is confusing for consumers with different builders signed up to different codes of practice. Those buying a new shared ownership home have been excluded entirely. We argue that shared owners need even more protections, not less and therefore support the development of a wider Shared Ownership Code specifically for this sector and a code for Retirement Villages for those more vulnerable groups buying retirement villages which come with an array of fees and charges.
• To offer new homebuyers a clear path of redress if they have problems with their newbuild property we’re calling for new government to finish what the previous government started and mandate that all buyers of new homes – including shared owners and retirement housing – have access to a New Homes Ombudsman

Are you hopeful that a new Labour government will get it right? Tell us in the comments below.

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