Almost a year into this Government and we already have an indication of where housing policy is heading over the rest of this Parliament.
The Government has the laudable aim of reversing the tide of declining home ownership and all their policies are geared towards achieving this. To name a few:
- Starter Homes;
- A continuation of Help to Buy Equity Loan and the new Help to Buy London;
- An expansion of shared ownership;
- Right to Buy for housing associations;
- A continuation of Rent to Buy;
- Help to Buy ISA;
- And even the new Lifetime ISAs will have a home ownership element
Whilst positive, it does beg the question, what about people who will only ever be able to – or indeed want to - rent? The £4.7bn Shared Ownership and Affordable Housing Programme was opened for bids earlier this month. Yet there was a conspicuous absence of funding for social or affordable rent. The BSA supports the huge planned expansion of shared ownership, but subsidised rent will always be an important element of the housing market.
Indeed, the term ‘affordable housing’ was once practically synonymous with social rent. Then it was expanded to include affordable rent and shared ownership. Now, we include Starter Homes too. Councils will have a duty to provide Starter Homes on all sites that can take them. With that prospect on the horizon, we might start to wonder how other forms of ‘affordable housing’ will get a look in.
The Chancellor is also acting to ‘level the playing field’ between buy-to-let investors and first-time buyers. From this month, an extra 3% stamp duty applies to buy-to-let investors looking to expand their portfolio. From next year, mortgage interest tax relief will disappear for this group.
The Chancellor has also given the Financial Policy Committee the nod to look into placing ‘macroprudential’ controls on buy-to-let lending. Alongside this, the PRA is consulting on placing microprudential controls on buy-to-let underwriting standards. The private-rented sector in the UK relies to a good degree on small-scale landlords, and buy-to-let is an important component of that.
The BSA supports any measures to get more first-time buyers onto the housing ladder, we also want to see a balanced housing market with a mix of tenures, the fundamental issue remains a lack of supply and this is starting to impact affordability across all tenures.