PM Liz Truss - comments from Rob Clifford at Stonebridge Group

06 September 2022

“The new Prime Minister has a huge in-tray to tackle right across the board, and the UK housing market is no exception to that. We currently have significant supply-side shortages in both the owner-occupier and private rental sectors and, in the PRS this is driving up rents for tenants. The decision – by successive Governments – to focus on a first-time buyer versus landlord narrative has undoubtedly caused a large number of landlords to pull out of the PRS, hence why we have seen supply fall. It may be wishful thinking to hope for a u-turn on some of those taxation policies that have impacted so heavily on landlords so perhaps the most we can hope for is no further changes which make it even harder for landlords to run their portfolios.

“In terms of overall housing supply, it looks likely that the 300k new homes by the mid-2020s manifesto commitment will either be ditched or sidelined. Liz Truss called these targets arbitrary and ‘Stalinistic’ however my view is that it is important to have such targets even if, in this case, they have been wildly optimistic.

“Tackling some of the local barriers to house building would undoubtedly help, specifically if they are mere NIMBY-ism, as long as the case can be made and the necessary logistics and local services are in place, then we should be approving larger-scale developments, especially those which prioritise starter and affordable homes.

“There has been some talk from the new PM about decoupling the Bank of England from its interest rate-setting role, however I hope this was mere ‘hustings talk’. Taking away the Bank of England’s independence in setting interest rates would I believe be a mistake. Handing this power to politicians at any time, but especially during this economic cycle, would in my opinion be a real retrograde step and would do far more damage than good with the potential for rates to be changed for purely political rather than economic reasons. I hope the new PM rethinks her views on this.”