What do the Conservative, Labour & Lib Dem manifestos promise for homeowners?
We were starting to panic the political parties had forgotten about housing and the issues faced by homeowners, but finally the 2019 general election manifestos are in and we’ve played spot the difference so you don’t have to…
What the 2019 general election manifestos say at a glance:
|Brexit||Leave EU end of Jan||Offer another vote||Revoke Article 50 – remain in EU – no referendum|
|Building new homes (for private ownership)||300,000 homes a year. A million in next 5 years||No mention||300,000 each year|
|Social Housing||No mention||Building at least 150,000 new council and social homes by the end of the next Parliament||100,000 of new homes will be social|
|Help to Buy||Continue to 2023||Focus scheme on first-time buyers on ordinary incomes||No mention|
|Leasehold||Continue current planned reforms of leasehold inc ban on leasehold houses||Reform leasehold||No mention|
|Right to Buy||Maintain right to buy and extend to housing association tenants||End right to buy||Devolve to local councils|
|Cladding||Hackitt report recommendations implemented. Removal of unsafe cladding||Enforce removal of cladding £1 billion. Fire Safety Fund to fit sprinklers and other fire safety measures in high rise||No mention|
|Eco friendly homes||Support new kinds of homes that have low energy bills to support environmental targets. Expect all new streets to be lined with trees||New zero-carbon homes standard for all new homes, and upgrading millions of existing homes to make them more energy efficient||Insulate all homes by 2030. All new homes zero carbon by 2021|
|Stamp duty||A 3% stamp duty surcharge on non-UK resident buyers||No mention||Link stamp duty to energy efficiency|
|Homelessness||End rough sleeping in 5 years||End rough sleeping in 5 years. 8,000 homes for rough sleepers||End rough sleeping in 5 years|
|Renting||Abolish no fault evictions. Introduce lifetime deposits. Rental reforms||Introduce rent controls. Annual MOT for landlords.||Help to Rent Scheme. 3+ year tenancies. Limit rent rises. Landlord licensing|
|Fracking||A moratorium unless science says its safe||Immediate and permanent ban||Ban fracking|
|Second homes||No mention||A new national levy on second homes used as holiday||Increase council tax by up to 500 per cent for second homes. Stamp duty surcharge on overseas residents|
|Other housing initiatives||More homes to local families via discounts from councils. Longer fixed rate mortgages for first time buyers. More Shared Ownership||Create Dept of Housing and a Sovereign Land Trust to buy land and lease back to communities. Low cost homes reserved for first time buyers||New Rent to Own model for social housing where rent payments give tenants an increasing stake in the property, owning it outright after 30 years. Abolish the bedroom tax and introduce positive incentives for people to downsize|
An end to Brexit uncertainty?
We’ve highlighted Brexit in the above table because if you’re looking to move home next year then it is an important factor. Like any market, the housing market doesn’t deal well with uncertainty.
While house prices have been climbing fairly constantly since 2012, after the June 2016 referendum the pace of growth has been sluggish.
Property commentators often talk about a post-Brexit bounce, as the nation is expected to give a collective sigh of relief and “get on with their lives” once Brexit is done. So if you’re waiting for Brexit before you move, you might want to take this into account when you vote.
Still a focus on quantity over quality of new build homes
New homes are critical – we need to ensure there are enough homes of every tenure for everyone to live in. And building new homes featured in all the main political party 2019 general election manifestos.
But here at the HomeOwners Alliance we continue to have concerns about the quality of newly built homes. Our campaign for better new build calls for greater consumer protection. And there was a real lack of detail about how quality was going to be addressed by all the parties. We would like to hear more about the incentives a future government might use to get all house builders to deliver quality consistently as well as quantity.
We also believe a property ombudsman for new build is essential to mediate disputes between new homebuyers and developers, rather than forcing them to go to court. The government supported this and it was announced in October’s Queen Speech. We hope its absence from the manifestos is an oversight.
First-time buyers and affordability
No political party has neglected the aspiring first-time buyer with schemes and initiatives aplenty. Affordability is acknowledged as the main issue.
One way the Conservatives want to address this is by encouraging a new market in long-term fixed rate mortgages.
Under the plan, buyers would need a 5% deposit and the mortgage repayments would then remain the same throughout the lifetime of the mortgage. A longer-term commitment would require a lower level of stress testing by the lenders and therefore make it easier for first-time buyers to borrow.
But long-term mortgages exist at the moment. The take up has always tended to be a small niche of the market. And with rates extremely low across the board, current 10-year deals are still higher than you can secure for 5 year deals. So we wait to see what “encouraging a new market” will mean in practise. We also question who is confident enough about the future to commit to a 10+ year mortgage product.
As part of the announcement, the Conservatives also promised to launch a ‘First Home’ scheme, giving first-time buyers a 30% discount on new homes in their local area. How this will be implemented is unclear.
The Labour manifesto acknowledges that affordable homes currently fall short; “We will scrap the Conservatives’ bogus definition of ‘affordable’, set as high as 80% of market rents, and replace it with a definition linked to local incomes. These council and housing association homes will be more affordable than market housing and built to higher standards. ”
They also say they will “build more low-cost homes reserved for first-time buyers in every area, including Labour’s new discount homes with prices linked to local incomes. ”
This is similar to the Conservative promise to “allow councils to use the money they raise from developers through the planning process to give low-paid local people a discount of up to a third on some of the new homes build”
The Lib Dems have said they will “Help people who cannot afford a deposit by introducing a new Rent to Own model for social housing where rent payments give tenants an increasing stake in the property, owning it outright after 30 years.”
We were very pleased to see leasehold get a mention in two of the three main manifestos.
But we continue to be concerned that political parties will only do the bare minimum rather than a much needed wholesale reform of the system. There needs to be a fairer system introduced. And there needs to be help for people stuck in leasehold properties and unable to remortgage or sell and facing unfair, escalating fees through no fault of their own.
Unsafe cladding in high rise
Following the horror of Grenfell two and a half years ago, it is essential that political parties addressed cladding and safety in high rise flats. Both Labour and the Conservatives say they will implement the Hackitt review recommendations and take steps to improve fire safety.
But there are few details of how practically a future government will help those people stuck in homes – usually leasehold – unable to move or remortgage because of uncertainty around cladding on their blocks. There needs to be more pressure on freeholders/landlords, lenders, surveyors, engineers and councils to put this right, as well as a greater sense of urgency.
Stamp duty untouched
The only mention of the tax in the Conservative and Liberal Democrat manifestos is the welcome idea of charging foreign buyers extra when they buy a property in the UK.
The Conservatives will use that windfall to pay for the roll out of rough sleeping initiatives across the country to end rough sleeping. This measure is expected to raise £120 million a year.
The Liberal Democrats have said they will also link stamp duty to the energy rating of properties.
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Kindly shared by HomeOwners Alliance (HOA)