Boris’s plans unveiled in Queen’s Speech

The newly formed Conservative government under Boris Johnson has promised not only to make sure Brexit happens on 31 January but to take steps to support home ownership, including upping the number of discounted homes for local first-time buyers. Under the new housing plans, councils will be able to use housing developers’ contributions to discount homes by 30% for people who cannot otherwise afford to buy in their area. And the Affordable Homes Programme will be renewed, building more homes for rent and delivering a new shared ownership offer. In addition, new legislation will be brought forward to ban new houses from being sold on a leasehold basis and reduce ground rents to zero. Reacting to the commitment in the Queen’s Speech today (19 December), Vadim Toader, founder and chief executive of Proportunity, a fintech start-up offering Help to Buy-style loans, said: “In theory, offering discounts on homes for local first-time buyers seems a sensible and fair policy. However, given the considerable failure of the Starter Homes scheme, this policy must be viewed with some scepticism. “What’s more, limiting this policy to local homes only restrains the opportunities available to young people, who may want to live elsewhere for better job opportunities or quality of life.” Toader added: “The government is right to look for new measures to encourage home ownership among young people, but should be focusing on removing the main obstacle to getting on the housing ladder: sky-high deposits.” In the Queen’s Speech reopening parliament, the government also promised to bring forward new measures to protect tenants and improve building safety, including a new lifetime deposit scheme which will see tenants’ deposits move with them from property to property and the abolition of no-fault evictions. Building safety post-Grenfell Dame Judith Hackitt’s Independent Review of Building Regulations and Fire Safety, following the Grenfell Tower tragedy, will also be taken forward through a new Building Safety Bill. The legislation will provide clearer accountability for, and stronger duties on, those responsible for the safety of high-rise buildings throughout design, construction and occupation, and give residents a stronger voice. Furthermore, the government will strengthen enforcement and sanctions to deter non-compliance, in order to hold the right people to account. In addition, legislation will be introduced to implement the recommendations of the Grenfell Tower Public Inquiry Phase 1 report through changes to the Regulatory Reform (Fire Safety) Order 2005, as soon as possible. New legislation will also be brought forward to require developers of new-build homes to belong to a New Homes Ombudsman. Business rates shake-up Other measures to be taken by the government include overhauling business rates, which have impacted the UK’s high streets in recent years. The government plans to legislate to increase the frequency of business rates revaluations to every three years, to ensure that business rates payers have bills that more accurately reflect current property values. The next revaluation will be brought forward a year from 2022 to 2021. Commenting on this promise, Scott Harkness, head of commercial at Carter Jonas, said: “Restoring the relevance of the UK’s high streets is a clear requirement, and the Conservatives have focused on a reduction in business rates to help achieve this. However, a point that appears to have been overlooked is the importance of placemaking. “Any high street resurgence is unlikely to mirror that of the past. In our experience, the focus should be on creating a vibrant environment, which has the interests of the whole community at its core. Town centres are the heart of our communities and should include a variety of uses that serve and meet the needs of local people. This is how we will ensure that the UK’s high streets and town centres remain cornerstones of local communities.” John Webber, head of business rates at Colliers International, said: “The government’s recognition that they will commit to conducting a further review of business rates is good news. However, without further fundamental reform, and in particular an end to downwards transition, such changes will be meaningless in saving the high street. “It does nothing to stave off the real problem with the high street – the struggling bigger retailers who carry the bulk of the business rates burden and have been the ones closing stores and making redundancies in the past few years. “With a majority of 80 seats, the government really has a chance to do something radical and not just piecemeal vote-winning tinkering, so I really do hope it does so.” Webber added: “The Conservative proposals do not support the larger retailers and, to be honest, even if they tried to do more by way of reliefs, they would be hampered by current EU state aid rules, since the EU has placed a cap of €200,000 over a three-year period on state aid for any company in the European Union. “Bigger businesses are therefore missing out. Many of our clients would currently be eligible for relief on their business rate bills given the amount they pay and the state of their finances, but EU state aid provisions make it very difficult for companies to claim the reliefs they need to keep their businesses moving forward. “And given that the UK government has said it will import EU state aid rules and have them administered by the Competition and Markets Authority, even if we left the EU, unless this policy changes, the bigger struggling retailers will still be largely on their own – which is why the reliefs route does not work and we need fundamental reform.” Targeting net zero The government has also said it is to continue to take steps to hit net zero greenhouse gas emissions by 2050 and bring forward a Bill to improve the UK’s environment, enshrining in law environmental principles and legally binding targets, including for air quality. Asif Din, sustainability director at the London studio of Perkins & Will, said: “The promise to meet net zero greenhouse gas emissions by 2050 will require urgent and significant systemic change. The built environment currently contributes to 40% of the UK’s carbon footprint. “If we, as a nation, are to actively pursue an ambitious net zero target, the property industry must have a robust response to climate change. This requires the development of all new cities, towns and buildings to be energy-efficient, net zero operational and climate-resilient with immediate effect. “With the race to net zero by 2050 firmly on, the onus is on architects, developers and investors to develop new business models that step up to the challenges posed by the climate crisis, reflecting an industry with a long-term approach.” Welcome indicators Meanwhile, RICS head of UK government engagement and cities strategy Hew Edgar commented: “There are some welcome indicators of the government’s intent for the built and natural environments, including the announcements of investment in infrastructure, bolstering housebuying activity, bringing changes to business rates and tackling climate change – all of which echo and align with the RICS’s own priorities. “Further announcements around protecting tenants and enhancing building safety are welcome too. Ultimately, however, the devil will be in the detail. With a parliamentary majority of this magnitude comes the increased likelihood of government Bills passing and, therefore, great responsibility. It is imperative that the government gets the detail right, and considers the social and environmental impact of all its activity.” Bruce Dear, head of London real estate at Eversheds Sutherland, added: “Overall, the Queen’s Speech was the cat that didn’t meow. This isn’t surprising given the policy-lite Conservative manifesto. However, there were interesting ideas on housing and planning. “On housing, the government knows it can’t claim to deliver the ‘people’s priorities’ unless it houses all of the people. If it survives consultation, a First Homes programme of permanently discounted homes for local residents and key workers would help heal the divide that scars our society – the housed and the unhoused. “Tory free marketeers always blame the housing crisis on the planning system. Even though it could do with some simplification, this is like footballers blaming the ref when they don’t score. What really matters is how much the government will invest in infrastructure to incentivise housebuilding. If it goes large – bigger even than the promised £10bn Single Housing Infrastructure Fund – then we might get somewhere.” To send feedback, e-mail louise.dransfield@egi.co.uk or tweet @DransfieldL or @estatesgazette Photo: Matt Dunham/AP/Shutterstock