Property news of the week: May 14th 2021

The Queen’s Speech

This week, those interested in housing policy gathered to watch the Queen’s Speech, in the hope that the property market would remain a priority over the coming year. Happily, the speech - written by Government - laid out a number of policy priorities for the property sector.

On the whole, these were received positively by the industry. However, there was a feeling, that these policies might not go far enough to fully solve some of the issues the industry faces.

The announcement of a new building safety regulator was particularly welcomed, after news of a fire last week at Providence Wharf - a new-build apartment block in East London - underscored the urgency of new measures to improve building standards and safety.

Similarly there was general approval of the Government’s pledge to reform leaseholds. Policy changes this year should put an end to ground rents in leasehold contracts. This is certainly a welcome change, and will help make leasehold properties more affordable and appealing to buyers.

Estate agent body, Propertymark, commented that the promise of leasehold reform was a ‘step in the right direction’. However, they intend to continue lobbying the Government in the hope that they will extend reforms to current leaseholders too.

Confirmation of the Government’s intention to introduce planning reforms also received a mixed response. Jackie Sadek, ex-government advisor & housing expert, responded articulately with the argument that the housing crisis is ‘more a crisis of affordability than a crisis of supply: there’s no problem with supply of homes for owner-occupiers who can afford top dollar’. She's not convinced that attempts to 'streamline' planning processes will actually make housing more affordable.

A notable absence from the speech was the Renters Reform Bill, which was first promised in the 2019 Conservative General Election manifesto, and again the 2020 Queen’s speech, but is still yet to come into fruition. The Government did say, however, that they would be releasing a White Paper on rental reforms in autumn this year.

Halifax House Price Index - April 2021

This week, Halifax released its monthly House Price Index, which tracks house price growth using mortgage applications. According to their research, house prices reached a record high for the second month in a row in April.

Not only had house prices risen dramatically from the month before, they were also 8.2% higher than April last year. This is the highest rate of annual growth Halifax has seen for 5 years, and in cash terms is the equivalent of almost £20,000 added to the value of the average home.

Russell Galley, the bank’s managing director, suggests that the consistent & rapid price growth we’re seeing is due to the stamp duty holiday adding ‘impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the Government scheme.’ He remains generally optimistic about the recovery of the UK economy over the next few months, but does believe that house price growth is ‘likely to slow to the end of the year.’