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Housing Policy Under Labour: One Year On

Twelve months ago, the Labour government was elected on a manifesto with housing policy at its heart. It pledged to improve the lives of renters, as well as make housing more affordable by accelerating housebuilding and reforming planning policy, which in turn placed housing policy at the centre of the government’s ‘growth mission’.

One year on from this government taking office, what have been the major trends in housing policy under Labour, and how much progress is it making against the commitments it set out before the election? In this blog, our consultants Sam Tankard, Will Blackman and Joshua Owolabi look at the biggest housing policy initiatives from the government and what to expect next.

Planning and Housebuilding

The root of many troubles facing UK construction and housebuilding lies in the planning system which, in its promise of reform back in 2023, Labour committed to “back the builders not the blockers”. This move was seen as necessary if Labour had any hopes of meeting its manifesto promise to build 1.5 million homes over the course of this parliament. This was always a tall order given the UK has averaged 150,000 new homes between 2013 – 2023, despite targets often still sitting at around 300,000 a year.

The government’s Planning and Infrastructure Bill was introduced earlier this year as one of its flagship pieces of legislation, designed to speed up the delivery of new homes, increase capacity of local planning authorities with new planning officers, unlock land through compulsory purchase orders, and introduce a Nature Restoration Fund to offset environmental impacts.

This was welcomed by developers, investors and pro-housing campaigners as a sign that the government was finally putting in the policy requirements to unlock the level of growth needed to hit their targets, especially as housebuilding ‘starts’ since the beginning of this parliament are sitting at 186,000 – some way off the government’s target.

However, those same supportive voices now feel disappointed that the government has already started to water down the bill, even after removing the whip from an MP for leading a rebellion against it. In its original form, the bill was not considered hugely radical: criticised in part for only making tweaks rather than wholesale change. It does not, for example, even deal with the wider issues hindering development such as zoning and the value of available land, the labour skills shortages in construction, or the rising cost of materials that are pushing up the cost of housebuilding.

Now in the Lords, the government has introduced amendments that would make Environmental Delivery Plans harder and more complicated, as developers will now have to demonstrate how it will contribute positively to nature, and giving Natural England a potential veto on the delivery of new homes.

This significant concession signals the bill could be weakened further still, making it neither effective in delivering the housing at scale, nor enshrining the environmental protections that campaigners want to see. Housing Secretary, Angela Rayner, will need to use her political heft in the Cabinet to demonstrate the government remains on track and isn’t just compromising on a damp squib. After all, as a former prime minister once said, “standing in the middle of the road is very dangerous, you get knocked by the traffic from both sides”.

Rental Reform

One of the most significant areas of housing policy reform over the last 12-months was in fact originated under the last Conservative government. The Renters’ Rights Bill, which is currently coming towards the end of its passage through Parliament, has been a long time in the making.

It was the Theresa May government in 2019 that first consulted on reforms to rebalance the rights and responsibilities of landlord and tenants, which included ending the ability of landlords to issue Section 21 notices, or ‘no-fault’ evictions. This change continues to be the centrepiece of the bill and is intended to give greater stability and security of tenure to tenants. The bill also provides landlords with reformed and expanded grounds for seeking possession of their properties under Section 8 of the Housing Act 1988. This includes cases where the landlord wishes to sell or to move into the property themselves. Other measures include stricter requirements around rent increases, the creation of a new ombudsman, new requirements on landlords to remedy mould and damp problems, and a new right for tenants to request a pet.

The Conservative government’s version of this legislation – then called the Renters’ Reform Bill – fell away following the dissolution of the last parliament. Labour’s version of the legislation includes some significant differences to its predecessor, including increased notice and grace periods, and a three-month requirement of rent arrears before a landlord can seek possession, up from the two months proposed by the Conservatives. Almost all of the changes put forward by Labour are to the benefit of tenants rather than landlords.

Taken together, these reforms are the most significant changes to the regulation of the private rented sector for over 35 years. The residential landlord sector has been careful not to be seen to oppose the legislation outright given the unhelpful optics around this. However, many individual landlords are concerned that the balance has tipped too far away from them, potentially leaving many unable to take back possession of their properties in reasonable circumstances. Court backlogs have provided an additional layer of concern, with delays in processing evictions claims already persisting in many parts of England, and many landlords calling for significant improvements in order to allay their concerns.

Some industry leaders such as Propertymark and the National Residential Landlords Association have warned that the proposed provisions could lead to landlords withdrawing from the sector, in turn limiting supply and driving up rents. The Ministry of Housing, Communities and Local Government’s own impact assessment does not predict an exodus of landlords from the sector. Indeed, landlords have been subject to a raft of regulatory and tax changes since 2015, but these have not resulted in significant divestment from the private rental market, which many had predicted at the time. There is no question that these reforms are significant, but the longer-term impact of them may not be seen for many years to come.

Leasehold Reform

The Leasehold and Freehold Reform Act 2024 (LAFRA 2024) was passed by the previous Conservative government to strengthen leaseholders’ rights. However, its implementation has become the responsibility of the Starmer government as many of the reforms within the act require secondary legislation before they come into effect. This is a significant task given the high number and complexity of the provisions within the act.

In March 2025, the government implemented measures set out in LAFRA 2024 strengthening Right to Manage (RTM) provisions. Prior to March, landlords had been able to recover the costs of dealing with the RTM claim from the RTM company at the end of the process. Now, in a non-contentious claim, the landlord cannot recover any of its costs from the RTM company or the participating leaseholders.

The government is also consulting on the charges leaseholders – and homeowners on freehold estates – pay and the services they receive. One of the most significant challenges for leaseholders under the previous system was the inconsistent format of service charge demands. Once implemented, the new format will require landlords and managing agents to ensure that all demands on leaseholders are consistent, clear, and easy to understand. Any deviation from this prescribed format will render non-payment or late payment provisions in the lease unenforceable, providing a powerful incentive for landlords to comply.

While measures in the LAFRA 2024 will reduce excessive fees for leaseholders, many leaseholders may not fully understand their new rights under the reforms given the complexity of the act. Property agents will need to stay up-to-date with the regulations to guide tenants effectively, especially when it comes to disputes or questions about lease terms. Agents who manage leasehold properties will also need to maintain clear communication with freeholders, ensuring that lease terms comply with the new rules.

Despite the work already undertaken, the government intends to introduce further reforms. The Minister for Housing and Planning, Matthew Pennycook, has long favoured moving away from the leasehold system. As a result, the government has proposed a Leasehold and Commonhold Reform Bill, which will be introduced to parliament before the end of 2025. The bill would aim to make commonhold the default tenure for new flats and allow individual properties within a building or larger development to be owned on a freehold basis.

High quality property managing agents are likely to benefit from the proposed measures. Pennycook has made it clear that agents already play a key role in managing multi-occupancy buildings and freehold estates, and their importance will only increase with the proposed commonhold reforms.

Under the proposed model, agents would be employed by commonhold associations to assist in the day-to-day management of a building, and it is anticipated that almost all new commonhold developments, especially larger or more complex buildings, will be established with a managing agent to help run the site on their behalf. This could drive demand for agents with a strong track record of block management. The government is also considering whether it should be mandatory for a managing agent with appropriate expertise to look after high-risk buildings. Furthermore, the government is consulting on proposals for mandatory qualifications for agents and is highly likely to include measures regulating training and standards for agents in the proposed commonhold bill.

So far, the government made significant progress in enacting its leasehold reform agenda. Despite legal challenges to LAFRA 2024 and opposition from landlords to reforms, Matthew Pennycook and Angela Rayner seem determined to press ahead. Therefore, we can expect major changes to leasehold, commonhold and freehold regulation over the course of this parliament that will present new obstacles and opportunities for the housing sector.

GK Point of View - Will Blackman on reforms to the private rented sector

GK Point of View – Will Blackman on reforms to the private rented sector

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GK Associate Director, Will Blackman, takes a look at the reforms to the private rented sector contained in the Department for Levelling Up’s recent White Paper.  

This week the Government finally published its long-awaited White Paper on reforms to the private rented sector with its two central proposals consisting of, first, new measures to reform landlords’ grounds for repossession and, second, initiatives intended to tackle poor quality rental properties. The White Paper has been a very long time in development and comes almost three years after the Government originally consulted on its proposed reforms.

The Government’s proposed reforms would undoubtedly see the biggest shift in the balance of rights between landlord and tenant for over three decades. However the challenge for ministers and officials has been to find the optimum balance between greater security of tenure for tenants whilst, at the same time, ensuring landlords remain able to legally take back possession of their property where they have reasonable grounds to do so.

The headline proposal in the White Paper is the abolition of Section 21, or so-called ‘no fault evictions’, where landlords can evict their tenants at two months’ notice without needing to give a reason. At present landlords ordinarily seek possession of their property in one of two ways – by serving a Section 21 notice, or by serving a Section 8 notice, which enables them to evict their tenant providing certain grounds have been met, such as rent arrears or wanting to sell the property. To compensate for the abolition of Section 21, ministers are proposing to expand the grounds set out under Section 8 so that they cover a wider range of scenarios, such as anti-social behaviour. On the surface this sounds reasonable; however many landlords argue that they only use Section 21 because the court process needed to give effect to a Section 8 notice takes too long and is too convoluted. Whilst ministers are proposing reforms to the relevant court processes, in response to such concerns, only time will tell if it will be sufficient to maintain a healthy balance in the rights between landlords and their tenants.

Other measures in the White Paper have similarly been in the pipeline for some time, particularly to address the minority of so-called ‘rogue landlords’ and to enhance tenants’ rights to challenge poor landlord practice. This includes the creation of a new ombudsman to settle disputes between landlords and tenants, and the creation of a new national landlord register. The previously announced extension of the Decent Homes Standard to the private rented sector is also intended to create a minimum acceptable standard of accommodation and to remove the sometimes significant divergence in housing quality between the social and private rented sectors. The headline-grabbing announcement of a new legal right for tenants to have a pet in their home is something that many have been calling for; however it is the proposed outlawing of landlords refusing to let their properties to benefits recipients that could worry many across the sector.

Indeed, whilst the reforms overall are finely balanced, the big unknown is whether this package of changes will have an adverse effect on investment in the private rented sector going forwards..There is little doubt that these reforms will deliver on the Government’s intention to enhance the experience of those renting in the private sector. However there is a danger that some landlords, particularly with smaller portfolios, decide that letting a property is now simply too much hassle – particularly when considered alongside other tax and regulatory measures introduced in the last decade which have made letting property less financially attractive and which could see some opting to leave the sector. The knock-on effect this could have on the supply and affordability of private renting might well be significant.

The glaring omission from the White Paper is any clarity on the previously proposed new minimum energy efficiency requirements for private rented properties. In 2020 ministers proposed introducing a minimum EPC C standard for new tenancies from 2025, and all tenancies from 2028 – but the Government has said little about the matter since then. It is this requirement that is really concerning many in the sector, as they face the prospect of large bills for upgrading their properties to the new minimum standard, which could be a particular challenge for those with older houses. Ministers will need to provide clarity on this matter soon if they are to avoid significant unintended consequences for housing supply in the coming years.