Ahead of the general election, we have reviewed the Conservative and Labour manifestos and have highlighted below five potential policies to watch out for:
1. Development of new homes
Due to the ongoing housing crisis, house building has played a significant part in the Labour and Conservative manifestos. Labour has pledged to build 1.5 million homes and to introduce mandatory housing targets; the Conservatives have pledged to build 1.6 million homes.
Both parties have said they will target brownfield and ‘grey belt’ properties such as former car parks and ex-industrial land. Labour has said it will strategically release greenbelt land for development, whereas the Conservatives have reiterated their ‘cast iron promise’ to maintain the green belt, looking to abolishing EU nutrient neutrality rules to unlock the extra 100,000 new homes.
2. S106 Agreements
Under S106 of the Town and Country Planning Act 1990, a local planning authority can require a separate agreement to secure positive obligations linked to a new planning permission, such as the delivery of affordable housing.
Labour has suggested that it will deliver more affordable homes by preventing developers from ‘wiggling out’ of providing affordable housing on the basis that to do so would make a scheme unviable. Before the election was called, Angela Rayner said that Labour intends to upskill local authorities through a centralised ‘Take Back Control Unit’. She also said that Labour would simplify the viability assessment by creating guidance on viability levels and a model assessment form for developers and councils to use when evaluating the viability of a site.
Conversely, the Conservatives have suggested that they will relax S106 obligations for smaller and local house builders and require councils to set land aside for them. It is uncertain how this would work in practice.
3. CPO compensation reform
Presently, when land is subject to compulsory purchase, the compensation paid can take account of future development potential (hope value). The Levelling Up and Regeneration Act (LURA) 2023 allows councils to apply to the Secretary of State for permission to ignore this requirement if the council intends to use the land for certain uses, such as affordable housing, but this has not yet been brought into force. The Conservatives have pledged to introduce this.
Whilst Labour agrees that hope value should be ignored when assessing compensation for certain developments, it would also allow councils and Homes England to compulsory purchase land without the Secretary of State’s consent provided a public interest test is met.
4. Leasehold reforms
The Leasehold and Freehold Reform Act 2024 became law on 24 May. However, the much-discussed cap on ground rent was missing.
The Conservatives have pledged to cap existing ground rent at £250 and to reduce ground rent to a peppercorn over time. The Conservatives have also promised to end the misuse of forfeiture and to make it easier to take up commonhold as an alternative to leasehold ownership.
Labour has promised to end the ‘feudal leasehold system’ by enacting Law Commission proposals on leasehold enfranchisement, right to manage and commonhold. Labour also intends to ban the sale of new leasehold flats and to make commonhold the default tenure.
5. Energy Performance Certificates (EPC)
In September, the Government scrapped the target for all private rental properties to have an EPC rating of C by 2028. However, Labour has suggested that it is committed to increasing the minimum energy efficiency standards by 2030. As the policy does not indicate what the efficiency standards will be increased to, we will have to wait and see how ambitious Labour might be.
Conclusion
The Labour and the Conservative parties have not promised anything which is surprising. Given that housing is a key battleground between the parties, the lack of proposed policy to address issues around second homes and short lettings of housing may raise eyebrows in some constituencies.
Get in Touch
For more information regarding the Commercial Property sector and how the above policies might affect you and your business, please contact Beth Margetson at beth.margetson@mfgsolicitors.com, Jack Cook at jack.cook@mfgsolicitors.com, or call 0121 2367388 to speak to a member of our team.
Comments