Labour are in power following a landslide victory and Sir Keir Starmer takes his place as the UK’s newly appointed Prime Minister. How will the change in government impact the UK property market?
He has already listed the 6 things that he plans to address in his first month in power as;
- Immigration
- NHS Strikes
- Prisons Crisis
- Planning Reform
- Relations with Nations and Regions
- EU Elections
How Will Property be Affected?
Homeowners and property investors will be keen to understand how a change in the political landscape will affect them. A national poll revealed that almost half of voters who prioritise the housing market, chose to back Labour in the General Election, demonstrating that many consider them as the best option for addressing the UK housing market.
National Planning Policy Framework
The Labour manifesto commits to updating the National Planning Policy Framework to reverse some of the changes made by the Conservative Party. We wait to see what aspects of the framework will remain and what will be updated.
First Time Buyers
Labour’s flagship housing policy is the Freedom to Buy Scheme, to help get 80,000 or more young people onto the property market by making the current mortgage guarantee scheme permanent. This is good news for those looking to buy in the next few years, as this was due to finish mid-2025.
Stamp Duty Land Tax has been frozen for first time buyers on properties up to the value of £425,000. However, Labour have proposed to reduce the threshold down to £300,000 which will force first time buyers of larger homes or those purchasing in the most expensive areas of the country to pay SDLT on the amount over £300,000. Watch this space to see if this change takes place.
Home Building
1.5 million new homes are set to be built under the new Labour government to help address the shortage of homes available and to help settle the rising prices of homes due to high demand and short supply.
To reach the ambitious target set out, they plan to fast-track developments on urban brownfield sites, release more ‘grey belt’ land for development, inject funds into urban extensions and regeneration projects and strengthen planning obligations for the Affordable Homes Programme.
Landlords
Landlords will need to pay close attention to the impending changes that the new party will bring in. They are promising to immediately abolish Section 21 evictions, give tenants more power to challenge unreasonable rent rises, tackle bidding wars between prospective tenants, cap upfront payments and impose more responsibilities on landlords to provide adequate, safe housing. Landlord should also keep an eye on an increase of capital gains tax rates.
House Prices
There are a number of factors involved in what happens to house prices. The future of interest rates and the wider economic health of the country is likely to have a much larger bearing on house prices.
There is speculation that we could see a short-term boost, post-election. This occurs when a new government or leader is elected by a large majority as there is a sense of consumer confidence.
Initial Thoughts
We have had sight of the manifestos, pledges and campaigns over the last few weeks of campaigning; however, we must wait to see what changes will be implemented with immediate effect. Often it takes time for new proposals to be passed and delivered.
Get in Touch
If you are moving house, buying your first property, or looking to sell your home – our friendly team at Barker Booth & Eastwood are on hand to advise you on your best options.
Call us for a competitive estimate on 01253 362500.
