Ahead of this year’s general election, the Prime Minister committed to turning “the dream of owning a home into a reality,” which is undoubtedly a noble aim given the social and financial stability homeownership provides.  

Labour’s analysis ahead of the election focussed on decades of under supply that have failed to keep pace with demand, most acutely in London, the South East and increasingly other major metropolitan areas.  

Rewarding failure 

Our current byzantine system of local government encourages local politicians to delay Local Plans and reject planning applications, as local elections turnouts are low are regularly favour anti-development sentiments.  

Having spent several years as a councillor and Cabinet Member for Housing trying – ultimately successfully – to adopt an ambitious Local Plan, I can attest to how incredibly frustrating and cumbersome the system can feel. 

Human costs of housebuilding failures 

Daily emails from families struggling to pay rent and local people being forced out of their home area would be enough to turn most – but by no means all – NIMBY-minded councillors into champions of housebuilding.  

Rough sleeping, sofa-surfing, unsustainable living situations, cost-of-living crunches and older children still living with parents, the social ripples and implications of housebuilding failures are profound and distressing.  

Having grown up in my local town and seeing communities broken up by excessive house prices was a slow-motion tragedy; increasing supply is crucial. 

Labour backs state power 

Despite my distrust of the current government’s appetite for bigger government and higher taxes, I welcome Labour’s announcement to take a sledgehammer to a sclerotic planning system and local political system that has played an ignoble role in suffocating supply of new homes, in particular: 

• introduction of mandatory housing targets to deliver 370,000 homes per year 

• focussing higher targets in areas with greatest unaffordability and potential for growth 

• mandatory review of green belt boundaries and introduction of ‘grey belt’  

Free-market alternative 

I do not believe that our political system would elect a government that would support a profound liberalisation of the planning system, whereby if you own land you can build on it without a consenting system, albeit within clear safety guidelines and rules. 

As with all market systems, supply would more closely track demand – however, the consequences of this with an ever-increasing population would result in outcomes the British public would almost certainly be horrified about.  

Real term price cuts or just keeping up 

Which takes me on to one of the central unanswered questions around these reforms, which is what long-term effects these reforms are intended to have on the affordability of homes in high demand areas.  

There has been limited coverage of whether the government’s new targets would result house prices rising slower than wages (i.e., real-term reductions) or will simply keep track with an ever-growing population (i.e., house price grows remains constant).     

If it is to be the former, the economic and social benefits are clear – cheaper, better-quality housing, affording the opportunity of home ownership in the country’s most desirable areas.  

If it is to be the latter, then the short-term economic stimulus through building, and reduced housing costs could potentially be wiped out as the increased supply is met with an ever-growing demand – bringing us back to square one.  

Immigration and Reform UK 

This question is inextricably linked to ongoing debates around the record levels of net immigration. Labour needs to be able to demonstrate that the homes they are building will make it easier for people to buy or rent homes in the areas they want to live and work.  

If the housebuilding is seen to simply be keeping pace with a growing population, then the discussion will keep coming back to net immigration being the cause of stubbornly high house prices.  

The Government will also face broader political questions on its decision to arguably relieve London with lower-than-expected uplifts in its targets and moving those to local authorities on the capital’s periphery and in more rural area, which now expect to absorb a greater proportion of the new homes.  

You can well imagine Reform UK – currently rising in the polls – making the argument that huge demand for homes from high net immigration is making housing unaffordable and putting pressure on non-metropolitan areas.  

The best counteraction to this argument is lower real terms house prices, increases in homeownership, lower interest rates and more affordable rent – naturally, none of this is easy but will be necessary to avoid immigration continuing to be a potent political argument against the housebuilding revolution Labour is endeavouring to lead.  

Grayling Planning & Infrastructure 

Grayling Planning & Infrastructure team provides communication and stakeholder engagement services that support the UK’s energy transition, major economic development projects and infrastructure delivery.  

Our multi-award-winning consultants, based in our nine offices across the UK, engage with communities on major TCPA and NSIP projects. We have experience supporting major garden villages and other housebuilding, as well as extensive public affairs expertise in the development space.  

If you have projects requiring communications and engagement support, please do get in touch planning&infrastructure@grayling.com.