Market Commentary: Can Labour Fix The UK’s Housing Problem?
The run up to the UK election found many market participants questioning how Labour’s policies could impact both the ‘for sale’ and ‘for rent’ housing markets. We continue to suffer from a chronic housing shortage in the UK and there remain concerns that new regulation, particularly rent controls, could further constrain an undersupplied market. Thus far, the government has resisted these calls and Sir Keir Starmer, our new PM, has pledged to “take the brakes off Britain” by tearing up planning restrictions to build 1.5 million new homes”.1 Rachel Reeves, Chancellor of the Exchequer, has promised to “get Britain building again” by bringing back compulsory housebuilding targets as part of a wide-ranging plan to reboot the UK economy.”2
However, the PM’s 1.5 million new homes target would equate to 300,000 new homes annually over the next 5 years. We haven’t built more than 250,000 new homes in a year since 2000.3 Moreover, the current environment is challenging for developers, investors and end buyers alike, with high interest rates and inflated material and labour costs on one end, and much higher mortgage rates hampering housing affordability on the other.
Read the complete Market Commentary: “Can Labour Fix The UK’s Housing Problem?” below:
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