Labour in charge: what next for property?

Politics, especially the period before an election, can be hard to keep tabs on. With a new Labour Government assembled, our job is to make sense of what was contained in the party’s manifesto, what was verbally discussed by then shadow ministers and what will actually be delivered now Sir Keir Starmer is Prime Minister.  

The coming weeks will see matters crystalize and an important date is the 17th July. This is the State Opening of Parliament and the King’s Speech will take place during the ceremony. The monarch will read out the new Government’s policy priorities for the year.  

Even prior to this date, ministers have been appointed and sweeping announcements have been made, with some indication of what lies ahead for the property sector. Here’s what we know so far:-  

Mortgages for those with low deposits: the incoming Prime Minister, Sir Keir Starmer, has said he wants to “turn the dream of owning a home into a reality”, and has backed his pledge by promising to make the mortgage guarantee scheme a permanent feature of home buying, not just a temporary initiative. The scheme will go under the name of ‘Freedom to Buy’ and will allow purchasers with low deposits to secure a mortgage, with the Government acting as a guarantor.  

Rental reforms back on the cards: speaking on LBC Radio before the election, the new Housing Secretary and Deputy Prime Minister, Angela Rayner, confirmed she would ban Section 21 no-fault evictions ‘immediately’ if Labour got into power but that hasn’t been the case. At present, landlords can still serve tenants a Section 21. In the same interview, Rayner did acknowledge that the court system needed reform, hence why an instant ban didn’t happen. We expect a new timeframe for a Section 21 ban in the King’s Speech.   

The Housing Secretary has also said in the past that she would extend Awaab’s Law to the private rental sector, forcing landlords to react more quickly when damp and mould is reported, and although she would be in favour of rent controls, the latter has been moderated to become an end to rent-raising bidding wars between tenants. Rayner is also expected to confirm her previous stance that private buy-to-lets will need a C-rated EPC by 2030.  

New promises regarding new homes: one of the first major, post-election announcements came from the new Chancellor Rachel Reeves, and the creation of more homes was at the heart of Reeves’s speech. The Government is pledging to build an extra 1.5 million properties in England during its lifetime in Parliament. It is hoped this figure will be achieved by reintroducing mandatory house building targets for local authorities, reforming the planning process, executing a review of green belt land and hiring more planning officers.  

Work to do, starting with stamp duty: Matthew Pennycook, the new Minister Of State for Housing and Communities, is yet to make a major announcement but he wrote on social media platform X:

“Tackling the housing crisis and boosting economic growth is integral to national renewal. Time to get to work.”  

A party spokesperson did confirm after the election that Labour would not be continuing the discounted stamp duty rate for first-time buyers. Currently, first-time buyers only pay stamp duty on any part of their purchase above £425,000 but this will revert back to £300,000 from April 2025.  

We will continue to monitor the news coming out of Downing Street and will share our findings here. Please contact us if you’d like to discuss how the new Labour Government may affect your property plans.