With the UK general election set for July 4th, 2024, housing is poised to be a key topic. Let’s explore how election predictions might affect the supported living and social housing market, and what this could mean for housing investments.
When is the Next General Election and What Does It Mean?
The next UK general election will take place on Thursday, July 4th, with Parliament dissolving on May 30th. From this date, MPs are no longer MPs, and all official parliamentary business ceases until a new parliament is elected. While voting is not mandatory, those over 18 are encouraged to participate.
Why Has an Election Been Called Now?
Prime Minister Rishi Sunak is strategically timing this election. With lowering inflation and 0.6% economic growth, he aims to strengthen his party’s re-election campaign. Delaying could prove challenging, given recent large spending commitments on defence and compensation packages, which may leave little room for voter-swaying measures in the Autumn budget announcement.
The Labour Party’s Housing Vision Labour plans to significantly impact affordable housing, which could have implications for yield investing. Angela Rayner, Labour’s Deputy Leader, has pledged the “biggest boost to affordable housing for a generation,” focusing on social and council housing.
Key proposals include:
- Making developers accountable for accelerating social and affordable housing production.
- Unlocking government grants by increasing flexibility in the Affordable Housing Programme.
- Providing long-term stability to local authorities and housing associations to encourage investment in affordable, social, council, and supported living housing stock.
Rayner emphasises the need to rebuild “the dream of a safe, secure, affordable home” after years of Conservative policies. Labour aims to set clear targets, strategic planning, and a capacity plan to address the housing crisis.
What Labour is Proposing:
- Strengthen rules for developers to meet their social and affordable housing responsibilities.
- Upskill local authorities on section 106 negotiations.
- Introduce a model assessment form for evaluating housing needs.
- Limit developers’ ability to avoid commitments to build more social and affordable homes.
- Unlock government grants to deliver new homes by allowing officials to redirect funds to high-demand projects.
- Enable councils and housing associations to use more grant funds for purchasing existing market housing stock.
- Work closely with local leaders to better target funds.
- Champion social and affordable housing growth.
- End unplanned changes that cause instability in the sector.
What’s the Green Party’s Housing Policy?
The Green Party focuses on reducing empty homes and ending Margaret Thatcher’s controversial Right to Buy scheme. They pledge to have no more than 0.5% of homes sitting empty for over six months and propose government management of empty properties without becoming the legal owner.
Other Green Party commitments include:
- Funding local councils to meet affordable and social housing requirements.
- Creating 150,000 additional council and social housing units through new builds, refurbishments, conversions, and purchases.
- Introducing a Right Homes, Right Place, Right Price scheme to ensure high environmental standards and investment in local services.
While we’ve explored Labour and Green Party policies, it’s clear that all parties are prioritising housing to some degree. From reintroducing Help to Buy to abolishing Capital Gains Tax for two years, many proposed outcomes could positively impact housing market investments.
The focus on social housing and affordable homes in the upcoming election underscores the growing crisis in the UK. With rising waitlists and increasing homelessness, political attention to these issues is both timely and necessary. The policies put forth by various parties suggest a recognition of the need for systemic change and substantial investment in the housing sector.
For investors, this political landscape presents both opportunities and considerations.
The potential influx of resources and policy changes aimed at boosting social and affordable housing could create new avenues for socially conscious investing. However, the specifics of how these policies might affect property values, rental yields, and long-term market stability remain to be seen.
As the election approaches, it will be crucial for investors, housing associations, and local authorities to closely monitor developments. The outcome of the 2024 UK election could significantly shape the future of social housing and supported living investments, with implications that extend far beyond the ballot box.
Investing in social housing means investing in the long term, and if you’re seeking a high-yield investment, it’s perfect for you. This housing sector may be unique to investors but should be in everyone’s portfolio. Not only will you see a high yield on your investment, but you will also be helping to home some people who need it within the UK.
If you’re curious to explore social housing investments and how to invest purposefully to benefit society and your investment portfolio, contact Yield Investing property advisors today to learn more about how to get started.
