Boris Johnson’s oven-ready Brexit is out of the fridge, but some property professionals can still feel a chill. The property industry is lauding the Conservative party’s historic victory for the certainty it will provide: Johnson holds a Brexit deal in his hand; he could comfortably be in power for the next decade; Labour may have to wait 20 years before it knocks on the door of Number 10 again.
However, there is still plenty that’s open to interpretation. With only a year to negotiate trade deals that typically take 4-9 years to come to fruition, no deal is hardly off the table. There is also the question of whether the proposed points-based immigration system will equip the UK’s housebuilding industry with the labour it needs.
Then there’s Johnson’s pledges on housing in his crowd-pleasing manifesto, which had its share of critics.
“There are plenty of question marks hanging over the newly-elected government,” Paresh Raja, CEO of Market Financial Solutions, said. “When will the long overdue budget be delivered? Will there be changes to taxes like stamp duty? How will the housing crisis be addressed? I hope the Prime Minister addresses these questions and does not let Brexit continue to overshadow pressing national issues.
“For now, at least, all eyes are turned to the end of January when Boris Johnson’s commitment to deliver Brexit will be put to the ultimate test.”
Certainly, the election was fought and won on Johnson’s simple ‘Get Brexit Done’ mantra, however the reality will be far more complicated than the slogan promises.
Will Scoular, co-head of origination at Investec Structured Property Finance, said: “Brexit uncertainty has been an impediment to UK economic momentum since the referendum. A Conservative majority will likely relieve some of this as the UK Parliament then passes Mr Johnson’s Brexit deal, allowing Brexit by 31 January 2020.
“Uncertainty will not though be eliminated as questions over the UK’s permanent trading relationship persist. Still the removal of some of the Brexit fog should help lift business investment, UK growth and with it housing activity too.”
However, Brexit has dominated the conversation for three years, at the expense of addressing urgent issues such as the housing crisis. These discussions will now need to resume. “The government has a majority now not just to ‘get Brexit done’, as we’ve been hearing during the election, but to get on with some of the other issues that have been holding the country back.
“There’s been plenty of talk from Boris’s camp – going back to his leadership campaign earlier in the year – about reforming the planning system, getting more houses built and lowering the burden of stamp duty on the higher-value end of the market. He now needs to make good on that talk.”
Sadly, there was little talk of building more affordable homes to rival Labour’s vision for a social housing revolution.
Kate Henderson, Chief Executive of the national Housing Federation, said: “Housing associations will be looking to the new Conservative government to quickly deliver on its welcome manifesto commitment to renew the Affordable Homes Programme. Our members urgently need certainty about future funding to continue building thousands of affordable homes, including homes for social rent.
“The housing crisis has not gone away and we will be redoubling our efforts to build new homes, end homelessness and ensure everyone has the support they need to live with security and the dignity they deserve. We will also be renewing our calls on government to bring greater clarity on the critical issue of building safety, and to take a strategic lead in coordinating a national programme of works.”
Sweeping promises made at the Tory party conference in October, such as unpopular reforms to shared ownership, will also be nudged back into the spotlight.
Bjorn Howard, group CEO of Aster Group, said: “I urge the government to think carefully before making wholesale changes to how shared ownership works. As interest in it continues to increase, we must ensure that attempts to ‘simplify’ the model don’t cause it to stray too far from its core function – to offer an alternative route onto the housing ladder and provide security of tenure.”
The Federation of Master Builders (FMB) hopes that the new government will ease the well-documented struggles of the UK’s small builders. Brian Berry, Chief Executive of the FMB, said: “The new Conservative Government has a golden opportunity to sort out Brexit and set out its new vision for the UK. Building the homes and infrastructure that this country needs has to be a key priority to help drive the economy forward.
“The Government needs to back the nation’s army of small builders, by delivering on the promised £3bn National Skills Fund, investing in quality through a licensing scheme for the whole UK construction industry, and supporting local builders to retrofit the millions of homes that need to be upgraded to low carbon.”
So, while Brexit may be oven-ready, numerous issues that have been quietly simmering are likely to reach boiling point before too long. When bleary-eyed Britons emerged from the polls, they hoped to see a more stable world around them. The proof of whether the election result can deliver that will be in the tasting.
