SMP: hung parliament puts housebuilding in limbo?
13 June 2017
The hung parliament created by the election means that the housebuilding sector remains in limbo, in urgent need of immediate stimulus and a feasible long-term strategy, warns the Society of Mortgage Professionals.
“Despite it featuring prominently on both the leading parties’ manifestos, the result now places in a vacuum,” says head of operations, Vishal Pandya, “with months of uncertainty ahead as a new coalition government is formed, or another election is confirmed for later in the year.
“The housebuilding industry is in desperate need of some sustained stability, but is now faced with a period of uncertainly, where other political issues may force a housing policy to take a back seat.
“However, as it was a stated priority for both the leading parties, we hope it will remain high on the list for a new government, whatever its composition.”
Even if such a result had not transpired, Pandya was sceptical about the state of the market.
“Labour’s pledge that they would build a million new homes over five years made for a great sound bite,” he continued, ”but it is a target that the Conservative administration have found impossible to live up to. Last year, for example, the figure was 153,300 according to the Department for Communities and Local Government.”
Pandya went on: “Using figures compiled by the House of Commons Library, it has been 30 years since annual housebuilding averaged 200,000 units a year or more. In the six years they have been in power, the current Conservative government has managed to create 127,000 new homes a year. Clearly, it will take a great deal more than a promise made on a manifesto to turn intention into reality.
“The recent housing white paper went some way to acknowledging the problem and contained some interesting measures designed to reduce the deficit,” he continued, “but no-one seems to be talking the ‘Brexit factor’ into account and that will surely have a significant impact on any plans in the next five years and beyond?
“In many ways, the housing market has made great strides since the recession, but the gulf between supply and demand - the gap between the number of homes available and the number wishing to buy - continues to increase. Addressing this is the number one priority and it must be given the importance it needs.
He concluded: “The well-intentioned rhetoric in the build-up to the election has been rendered redundant for the immediate future. We desperately needed consistency and instead we now face the prospect of short to medium-term upheaval.
“Such uncertainty is not what was needed and we hope the new government - in whatever shape or form it takes - will quickly re-focus on the need for affordable starter homes, show a more flexible attitude to suitable brownfield sites and instigate planning reforms to support small builders.”
