In fact, Theresa May went as far as dedicating her time in office to fixing the UK’s ‘broken housing market’. She said the massive supply/demand imbalance, declining levels of home ownership and the prohibitive cost of renting in the private rented sector were all helping to shut millions of people out of the market.
The Prime Minister then promised that the government would now get back into the business of building houses, calling on house-builders to do their duty to Britain and build the houses the country is desperately crying out for.
“So whether you’re trying to buy your own, renting privately and looking for more security, or have been waiting for years on a council list, help is on its way,” the PM told her party in Manchester.
But what exactly does that help look like?
A cash boost for social housing
May outlined in her speech proposals to build a whole new generation of council houses, promising councils and housing associations an additional £2 billion in funding to build homes for social rent.
Taking a closer look at this policy, some critics have pointed out that the cash injection only amounts to 25,000 new council houses by 2021. Or, in other words, 5,000 homes a year.
This has led to criticism from opposition parties and housing charities, who say this number is a mere ‘drop in the ocean’ when you consider demand. Labour and others have calculated that around 1.2 million families are on the waiting list for affordable housing, and that this new pledge will help only a small number of people.
Meanwhile, the National Housing Federation has insisted that the 25,000 figure could rise to between 50,000 and 60,000, with the cash injection unlocking a further £3 billion in investment in all types of housing from the private and public sector.
The reaction of local councils to the new proposals has been largely positive. The Local Government Association (LGA), which represents over 300 councils in England and Wales, wants to believe the changes mark a radical shift in the Conservative Party’s housing policy.
LGA chairman Lord Porter said he was pleased that the government had accepted the argument that councils must be part of the solution to the country’s housing shortage, with councils resuming their former role as a significant builder of affordable homes.
“Councils are working with communities to approve nine in 10 planning applications but it is clear that only an increase of all types of housing - including those for affordable or social rent - will solve the housing crisis,” he added.
The revival of Help to Buy
The other main housing policy announced by Theresa May was a £10 billion cash injection for Help to Buy
, the policy first introduced by David Cameron and George Osborne in December 2013.
The extra money will be pumped in to the scheme to help 135,000 first-time buyers to get a foot on the property ladder.
May was coy when it came to questions about where this additional funding would come from, but insisted the proposals would be fully explained in the Budget on November 22.
The scheme has been criticised by those who oppose it for upping demand while supply is restricted, in turn inflating house prices. It’s also argued that only certain people are really eligible, with poorer households or certain parts of the country locked out.
Those in favour, meanwhile, point to all the first-time buyers who have been able to purchase their first home via the scheme – something they would have found nigh-on impossible without Help to Buy. They say more than 200,000 people have used Help to Buy to secure a newly-built home in the last four years.
Figures from the Home Builders Federation suggest that Help to Buy now helps one in 12 of all first-time buyers and has helped house-builders too, with high demand enabling firms to invest in new sites in a slow-moving market.
Levels of home ownership have dropped quite substantially in recent years, with the number of owner-occupiers in England dipping from 70.9% in 2003 to 62.9% in 2015/16. Many people are now renting for the long-term in the increasingly large, profitable and influential private rented sector – which is expected to house some 5.79 million households by 2021.
Will the new proposals help?
While the new funding pledges have been welcomed cautiously by some, others have pointed to how only a relatively small number of people will be helped by the cash boosts to social housing and Help to Buy.
If Theresa May is serious about fixing the broken housing market, many believe she is going to have to take even more radical steps to address the demand/supply imbalance of homes in the UK.