On Friday, it was confirmed Labour had achieved a landslide victory in the General Election, with many key members of the Conservative party also losing their seats altogether. Our new Prime Minister, Sir Keir Starmer, is now in office. “Change begins now” he says.
There has been minimal reaction from the markets so far, due to the widely expected result, with the pound and the stock market edging up very slightly on Friday. Despite the change of Government, we hope that a finalised result and convincing majority will bring some stability and confidence, which could give the mortgage market a boost. A number of mortgage lenders reduced their rates in the week of the election, which is certainly encouraging!
Below are some of the main points relating to homes and mortgages, as per Labour’s manifesto:
Labour intends to “Get Britain Building Again” and say the dream of home ownership has been out of reach for far too many young people.
They aim to build 1.5 million new homes over the next 5 years, creating new jobs in the process. This will involve changes to the National Policy Planning Framework. They will take a “brownfield first” approach, prioritising the development of previously used land.
They will reform compulsory purchase compensation rules to improve land assembly, speed up site delivery, and deliver housing, infrastructure, amenities, and transport benefits.
They will deliver the biggest increase in social and affordable housebuilding in a generation, and make changes to the Affordable Homes Programme to ensure it delivers more from existing funding. They will support councils and housing associations to build to capacity, and make a greater contribution to affordable housing.
They will prioritise the building of new social rented homes and protect existing stock by reviewing Right to Buy discounts and increasing protections on newly built social housing.
They will work with local authorities to give First Time-Buyers the first chance to buy homes, and end the farce of entire developments being sold to investors before the houses are built. They will also introduce a mortgage guarantee scheme to support FTBs who are struggling to save for a large deposit, with lower mortgage costs.
They will increase the rate of stamp duty paid by non-UK residents. They are also looking to reduce the stamp duty threshold for FTBs from April 2025.
Labour has committed to clean energy in the UK by 2030. Whilst nothing is confirmed yet, we expect them to bring in minimum EPC ratings for rented properties (a plan which was scrapped by Rishi Sunak). Landlords may be looking to raise funds to make improvements to the energy efficiency of their properties, and when purchasing, may be looking to buy properties which already have a rating of A or B.
They intend to immediately abolish Section 21 “no fault evictions” and stop private renters being exploited or discriminated against.
Of course, these changes will take time and we await further details on some of these policies. We will get a clearer sense of plans in the Autumn Budget. Political parties don’t always deliver or meet the targets set. As they say, the proof will be in the pudding!
If you’re looking to purchase, move home or refinance an existing property, and are unsure of how all this could affect your options, please speak to a qualified mortgage adviser. We will be up to speed with all the latest schemes and products available to you, can help find you an affordable solution, and guide you through the process and the jargon! Don’t take the risk of holding off in the hope rates will reduce. In the majority of cases, we could secure you a rate now, and then change this later if a lower rate became available.
If you’d like to have a chat with one of our advisers, don’t hesitate to contact us on 01702 538800 or email enquiries@ingard.co.uk
