What's on the (Tory blue) horizon for the Property Industry?

What's on the (Tory blue) horizon for the Property Industry?
After the election dust has settled - which will likely involve new brooms for Labour, Lib Dems and UKIP - what will be on the cards for the property industry over the next five years?
Mansion Tax

Labour’s proposed mansion tax on properties over £2 million is less likely. Instead, the family home will be taken out of Inheritance Tax for all but the richest by raising the threshold for married couples and civil partners to £1 million.

Buy-to-Let

Private landlords will be relieved to hear that Labour's proposals to regulate the industry by introducing 3 year tenancies with rent control are not an immediate concern.

Right to Buy

The Conservatives propose to extend the scheme to:

  • 500,000 housing association tenants who currently have no right to buy their home; and
  • a further 800,000 who currently qualify (but only for less generous discounts of £16,000 or less).

The scheme will be funded by requiring councils to sell off their most valuable housing stock as it becomes vacant and replace it with cheaper property.

The proposals are somewhat controversial and have been criticized by housing associations and industry bodies alike. There are a number of major issues which will need to be surmounted if such proposals are to go ahead, including:

  • Many housing associations are charitable bodies bound by rules not to dispose of assets for less than full value and to further their charitable objects - the principal one being to provide housing to those in poverty. Selling homes at an undervalue to promote home ownership likely falls outside even the widest interpretation of this object.
  • Many schemes built by housing associations were funded with debt or equity finance and are reliant on a rental income stream.
Custom/Self-Build

Historically, a number of barriers have led to significantly fewer homes being self-built in the UK versus the rest of Europe. Such barriers have included:

  • limited access to suitable plots of land;
  • access to development finance; and
  • regulatory hurdles.

The Conservatives have pledged to double the number of custom-built and self-built homes by 2020.

At the moment there is no obligation on local authorities to mak

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About the author:

Melissa Moore is a dual qualified in England and Wales and South African lawyer and has 14 years’ experience in property practice in England. She has worked in local government and been a partner at a regional law firm and most recently an associate director at Berwin Leighton Paisner which she joined in 2005. Melissa has wide experience in all areas of property law and specializes in commercial real estate development. She has experience in a number of sectors including hotel, leisure, offices, investment, industrial, motorway service stations and funding. She has worked on large scale strategic developments and government funding initiatives, town centre regeneration schemes and private mixed use developments both for public sector and private developers and investment funds. In 2013 she was ranked by Legal 500 as recommended for local government work.