Today saw a resounding victory for Jeremy Corbyn in the Labour leadership election having initially been put forward as something of a stalking horse. Many are claiming this to be the biggest political upset in living history with a dramatic swing to the left – back to Labour Party origins. So, will Jeremy Corbyn’s win help the UK social housing sector?
Social housing wind down
If you look at the figures it will immediately stand out that the UK social housing sector has been decimated over the last 30 years or so. The 1980’s saw Margaret Thatcher implement a right to buy scheme which effectively kickstarted the UK housing boom but left UK social housing in a difficult situation. Indeed while political parties such as the SNP in Scotland wax lyrical about increasing social housing, the Conservative party is ready to reintroduce the right to buy scheme.
This ongoing reduction in social housing has forced more and more people into the private let arena which has resulted in growing demand for property. This growing demand has pushed house prices further and further out of the reach of first-time buyers thereby creating a vicious circle with more people forced to rent. However, could Jeremy Corbyn be about to change all of this?
Could Jeremy Corbyn push for rent controls?
The property market and rising rents have played a prominent part in Jeremy Corbyn’s election campaign as he tries to reconnect with the people. It seems inevitable that he will push for rental controls in the private buy to let market although whether the Tory party, with an outright majority in parliament, will play ball remains to be seen. However, many Labour Party supporters believe that Jeremy Corbyn could eventually become Prime Minister of the UK and be in a position to push through his socialist policies such as rent controls.
At this moment in time the UK property market is ignoring any potential threat from a left-leaning Labour Party. Indeed while some believe this could be a positive turning point for the party, others are suggesting it could cast the party back into the wilderness. Only time will tell but it does seem as though Jeremy Corbyn’s policy on social housing has attracted much support.
The UK needs more houses
Whether or not Jeremy Corbyn actually gets the opportunity to put his policies into practice remains to be seen but maybe, just maybe, his election will push the Conservative party into fulfilling its promise of more new builds in the UK. Many of these new builds will ultimately fall into the social housing category with more affordable rents. So, while there is still much scepticism about the short to medium term direction of the Labour Party this may prompt the UK government to at least consider delivering on pre-election promises.
As we have mentioned on numerous occasions, whether we have a left-wing government, right-wing government or centre party, the UK property market and overall investment arena does learn to adapt. It will be interesting to see what happens in the coming years and whether indeed the lurch to the left by Labour Party supporters could eventually dilute the more capitalist based approach to the UK property market administered by the Conservative party?