Sir Keir wins keys to the House but is it built on shifting sands?

So it’s a Labour landslide but it’s not like 1997.

I remember the last time as if it were yesterday.

May 1st, 1997. A Labour Party led by Tony Blair won the general election defeating John Major’s Conservative Party after 19 years in Opposition.

It wasn’t a surprise win, then. It was a triumphant procession.

It was the era of the Spice Girls and Blair’s Babes, surround sound and Porsche Carreras, Boss suits and red roses.

There was an air of anticipation – excitement. This was a moment in history. This was Cool Britannia.

Fast forward 27 years and it’s not quite the same, is it?

It’s not Cool Britannia any more, it’s broken Britain – more shoulder shrugs than shoulder pads.

There is no overwhelming enthusiasm or expectation. More a crushing Conservative defeat than a Labour victory. A loss of Truss in British politics.

Still, things can only get better, can’t they?

Westminster with a swagger

Sir Keir Starmer enters 10 Downing Street to a fanfare of sighs of resignation. Having played it safe and kept his counsel, gingerly and lovingly carrying the Ming vase of power, he inched his way along the crooked paths and bumpy roads that led to the ultimate political prize.

Now what?

To be fair to Sir Keir, circumstances are a little different these days. For a start, there’s no money. Public services are in desperate need of investment and households have been clobbered by a cost-of-living crisis that has left many treading water and some struggling to stay afloat.

And when TB glanced over his shoulder at his Front Bench, his A-team, he cast his eyes over top political talent: Gordon Brown, Alastair Darling, Mo Mowlam, Margaret Becket, Robin Cook, Steve Byers…the list went on.

They looked as though they’d been running the country for years, patrolling the corridors of the Palace of Westminster with a swagger that said it was only a matter of time.

Can the same be said for Starmer’s first team picks? The jury, as they say, is out.

There is one trusted lieutenant, however, that comes to government with something of a gold-plated pedigree and that is 45-year-old Chancellor of the Exchequer, Rachel Reeves.

Educated at New College, Oxford and the LSE, she worked at the Bank of England and HBOS. It is said that she was offered a job at Goldman Sachs but turned it down – a peculiar move for a woman who was a chess champion at the age 14.

But more than anyone else, Rachel Reeves holds the key to the success of this new government – and, for that matter, for the property sector.

Luxurious majority

While affordability remains the biggest barrier to first-time buyers, viability is the biggest threat to landlords in the PRS. The high interest rates of recent years have introduced a new normal in terms of mortgage rates. Reeves must do nothing to endanger the downward trend of inflation which, if maintained, will eventually lead to a drop in rates and a subsequent boost to the housing market.

Additionally, there is a manifesto pledge to introduce a permanent mortgage guarantee scheme for those struggling to save for large deposits.  Although there is little detail about the generosity of the proposals, sooner or later they tend to nudge up house prices.

Labour’s headline proposal from the campaign was a pledge to build 1.5 million homes by the end of the parliament. No small task – although a luxurious majority should assist them in driving through the radical reform of the planning system, something which previous governments have failed to achieve.

Something else the last Conservative government failed to achieve was the much-vaunted shake-up of the PRS – the Renters (Reform) Bill failed to make it through the ‘wash up’ process before parliament was dissolved.

Labour won’t keep us waiting very long and renters reform is hotly tipped to be included in the King’s Speech which will be on July 17th (although it could take up to a year before the measures are enacted).

Deputy Prime Minister, Angela Raynor, has made it clear that Section 21 evictions will be abolished but it is likely that other proposals – more far-reaching than the failed Conservative Bill – will be introduced. These might include a strengthening of tenant’s rights to challenge unreasonable rents, ‘Awaab’s Law (requiring landlords to address hazards within time limits) and regulation of agents. The man hotly tipped to be the new housing minister, Matthew Pennycook, has pledged to ‘decisively raise standards’ in the sector.

Look out for more devolved powers for the recently elected mayors. These could cover housing standards, licensing and the planning process which is targeted for a radical revamp.

But don’t expect things to get better overnight. Unlike it’s Labour predecessor, there’s a long, hard road ahead for this new administration whether it leads to sunlit uplands remains to be seen.

Having said all that, it’s worth remembering that things could be a lot worse.

I’ll leave you with a bunch of stats that tumbled into my inbox over the last 7 days:
•    House prices and mortgage approvals held firm in June – despite the disruption of the general election;
•    Over the last 12 months, cash buyers have accounted for 32% of market activity, according to MyHomeMove;
•    Homelet says that the average UK rent price now sits at a record £1299 per month;
•    According to the Mortgage Advice Bureau, 81% prospective buyers want to improve the energy efficiency of their future homes;
•    GetAgent reported that 44.2% of homes listed for sale in Q2 had found a buyer – this is up 2% on Q1and shows that buyer demand continues to rise.

OK so it’s not a D:Ream scenario, but it’s by no means a nightmare, either.

Source: Estate Agent Today

Recommended Articles