The Queen’s Speech 2015: Housing under the Conservatives

shutterstock_167770721The Queen officially opened Parliament this afternoon at Westminster for the first all Conservative government in two decades. She outlined the Conservatives’ plan for the next 5 years, including the headline grabbing plan to extend Right to Buy to Housing Association tenants.

26 bills will be worked on by Parliament, however the most important Bill for our sector is the Housing Bill.

The Queen’s speech revealed that over 1 million housing association tenants will have the chance to “own their own home” through the scheme which offers tenants the opportunity to buy their homes at the same discount as Council tenants.

Since the announcement of the Conservatives’ plan during the General election, the proposal has not been welcomed with open arms by the sector. Some fear that the extension will result in fewer homes being built, a fall in the number of affordable homes and cause lenders to run away.

To tackle the housing crisis, Councils will be required to sell their most valuable housing when it falls vacant. The receipts will be used to provide new affordable homes in the same area, and the surplus used to fund the Right to Buy. The new Government has pledged that receipts from Right to Buy will help housing associations to replace the sold homes with affordable homes on a one-for-one basis, however the current right to buy scheme has demonstrated that these homes are difficult to replace.

As we know, in order to meet current demand, at least 200,000 homes will need to be built every year. However the Government is only aiming to deliver an extra 200,000 new homes across the life of the parliament through its new Starter Homes initiative. That will offer a 20% discount to first-time buyers under 40, however it is unclear how much this will improve the current situation, as the need for additional new homes remains.

The Housing Bill also includes a ‘Right to Build’ plan which will give individuals the opportunity to build their own home by giving them land with planning permission and a plan to release brownfield land to builders. The new Government hopes that the new plans will lead to a reduction in social housing waiting lists.

The sector fears the irreversible loss of social housing and in addition to a reduction in the benefits cap (from £26,000 to £23,000), it may prove to be a difficult 5 years for those who depend on the sector.

One policy we expected to see was the extension of the Freedom of Information Act to housing associations following comments made by former Justice Minister Simon Hughes in March stating that the act could apply to housing associations in the same way it would to any other contractor engaged by a public body. It remains to be seen whether this will occur following the removal of the Liberal Democrats from Government, but watch this space.