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Question time for the politicians
Who are you going to vote for? This is the question on everyone’s lips at the moment. As the Commercial Manager at Latest Homes I can hopefully give a guide as to the main parties’ manifesto claims about housing, house building, tenants and various taxation that will be brought in, or not, dependent on which party or parties come in to power. I have identified five key areas that are open to discussion; the mansion tax, the right to buy, the housing shortage, affordable housing, and last but not least the issues with longer term tenancies and the ‘banning of rip-off letting fees’.
In February 2013 Ed Miliband said that he would; “if in government, introduce a mansion tax and re-introduce a ten pence tax rate for low earners”. The tax is only a proposal in the United Kingdom and the concept of a mansion tax is widely attributed to Vince Cable.
The 2014 Autumn statement by George Osbourne announced changes to the stamp duty which meant that a buyer of a house at £2m would now have to pay £153,750 in stamp duty. In his speech he alluded to this being his alternative to Labour's mansion tax, but has recently been quoted as saying; "We are not going to have a mansion tax, or a new tax that is a percentage value of people’s properties. Before the election they will call it a mansion tax, but people will wake up the day after the election and discover suddenly their more modest home has been labelled a mansion.”
It is considered by some commentators to be a levy of £3,000 per annum on properties between £2 million and £3 million with higher value properties the bill is likely to be £12,000.
‘Longer term tenancies and the banning of rip-off letting fees’ – Labour has a plan for Generation Rent
A Labour government will support renters with longer-term tenancies and banning “rip-off letting fees.” Labour attempted to end a "fundamentally anti-competitive corporate practice" with an amendment to the Consumer Rights Bill that would have banned letting agents from charging fees to tenants, but was defeated by MPs. Labour wants to change the law to make three year tenancies the norm instead of the current 6 or 12 month tenancies that are currently in place. They want to make rent increases more predictable and they plan to ban letting agents charging fees to tenants.
So landlords would face 1970s-style caps on rent increases under a Labour government. In April 2014 the Conservatives said the policy had been tried unsuccessfully by socialist governments in Venezuela and Vietnam, and would result in low quality accommodation and fewer homes being rented out.
The Liberal Democrats’ website states: “Britain has had a housing shortage for years. We are working to tackle this problem in government. Together, our housing policies will create up to 340,000 construction jobs.”
They are wanting to bring 70,000 homes back into use, make 190,000 homes more affordable, make available £10bn to help builders borrow money for new house building and provide help for first time buyers by making mortgages cheaper.
Rent To Own
The ‘Rent To Own’ scheme, which forms part of the Lib Dem's new manifesto, aims to help young people build up a share in their home through renting. The scheme will involve participants paying a monthly amount, equal to market rent, for 30 years at which point, they will own the property.
"Rent To Own will mean, regardless of their background and family circumstance, they will be able to make this a dream a reality. This is about building a stronger economy and fairer society, and making sure Generation Rent has the same opportunity to get on in life as their parents and grandparents before them."
However, the ‘Rent To Own’ monthly payment is expected to be higher than a monthly mortgage payment for the same property. So the scheme will probably only benefit first-time buyers who have relatively high incomes.
Housing associations will have to build new properties specifically for the Rent To Own market.
Right to buy
“Right to buy for 1.3m families in housing association properties will be at the centre of Conservative manifesto”- The pledge is expected to see tens of thousands of housing association tenants a year take up a discount on buying a housing association property that will be capped at just over £102,700 in London, and £77,000 for the rest of England.
Councils will also be required to sell about five per cent of their remaining council stock. These most-valuable properties will only be sold once they became vacant, and once sold, councils will be required to build a more affordable, cheaper property on a one-for-one basis.
A Conservative Government would expect around 15,000 of these high value council properties will become vacant annually, and proceeds from these sales will release £4.5bn a year – cash that will not only build new affordable property, but also fund the proposed discounts to tenants, creating a £1bn Brownfield regeneration fund that will produce 400,000 new houses over five years.
United Kingdom Independence Party
UKIP Housing Spokesman Andrew Charalambous said; “We talk straight I want it to be known categorically that we will protect the British countryside not only by undoing the bogus Tory localism of imposing untenable housing targets on local authorities, but by scrapping HS2 and putting an end in the UK to one of the biggest scams in history – the EU wind farm project.”
He has gone on to say; “We will reform leasehold law, making it easier for leaseholders to extend their leases and challenge unreasonable service charges. Council housing entitlement should be first and foremost for those who have contributed to the system. It is time we ended the perception that British people are at the back of the housing queue.”
• Brownfield Revolution
Decontamination assessment grants, remove Stamp Duty from brownfield first builds and VAT from brownfield conversion costs. Plus a system of brownfield bonds. Building 1m homes on brownfield by 2025.
• Change the planning presumption in favour of residential in off high street office and commercial buildings.
• Merge planning and building control departments in local authorities, thus expediting, simplifying and cutting the cost and bureaucracy involved in the planning and construction process.
The Green Party state that they want secure affordable housing for everyone. “We all want where we live to feel like home, to feel safe and secure”.
“The Coalition has made this more difficult by pushing through the hated bedroom tax for social tenants, allowing landlords free reign to raise rents faster than inflation, and failing to invest in the supply of housing so that homes are over-priced and out of reach for many”.
• Abolish the bedroom tax.
• Build 500,000 social rented homes by 2020 and bring empty homes back into use to ensure everyone has access to an affordable place to live.
• Cap rent and introduce longer tenancies to provide greater protection for renters.
So how will the proposed manifesto claims affect Brighton & Hove?
Building work is starting on 29 new council homes at five sites across the city, with around 200 more in the pipeline, and 159 homes have been let since June 2014 to date (Brighton & Hove Council Homing In Newsletter Spring 2015). There are a number of sites that are currently being constructed to enable part ownership and for key workers in the city, which is certainly a good thing. However as a city, we are very restricted regarding space to build on. Recently planners rejected a planning application to put 85 homes on a greenfield site on Meadow Vale, in Ovingdean.
Brighton & Hove Council’s City Plan will be the council’s key planning document and will provide the overall strategic vision for the future of Brighton & Hove to 2030. It will set out how the council will respond to local priorities, meet the challenges of the future and identify the broad locations, scale and types of development needed together with the supporting infrastructure. The draft can be seen at www.brighton-hove.gov.uk/content/planning/local-development-framework/city-plan.
Right-to-buy has always been a contentious issue since the Labour Party initially proposed the idea of the right of tenants to own the house in which they live in its manifesto for the 1959 General Election – which it subsequently lost. And after Margaret Thatcher became Prime Minister in May 1979, the legislation to implement the Right to Buy was passed in the Housing Act 1980. Michael Heseltine, through his role as minister for the environment, was in charge of implementing the legislation. Some 6 million people were affected and about one in three actually purchased their unit.
Council house tenants will not be allowed to buy their own homes, under plans unveiled by the Green Party. Leader Natalie Bennett said her party would build 500,000 social homes on Brownfield sites, particularly in the north and the Midlands. The party would also bring 700,000 empty homes back into use. Labour wants to make first-time buyers exempt from stamp duty on homes up to £300,000.
Brighton & Hove has always had a high rental demand, which is now affecting the lower paid residents who are looking to live and work in the city. Rental prices are constantly on the increase and that, with the fees that are charged by letting agents, is making it increasingly difficult to find a property to rent.
Our city is a fantastic place to live, work and play. Let’s hope that whichever party is elected there is a balanced and considered approach to the need for new homes in the city.