PROFILE: New Housing Secretary to ‘build baby build’ but who is he?
Steve Reed has pledged to pull every lever to deliver 1.5 million homes target, following Rayner's Stamp Duty resignation.
Steve Reed (main image) has told civil servants his housing mantra will be “build baby build” as he takes charge of delivering Labour’s ambitious 1.5 million homes target following Angela Rayner’s resignation over her Stamp Duty underpayment.
Reed has promised to “move on to the next stage in unleashing one of the biggest eras of building in our country’s history” and will “leave no stone unturned to build the homes Britain desperately needs”.
Also, he has identified up to 1.4 million homes with planning permission that remain unbuilt as key to hitting the target, and says he will bring together leading developers and housebuilders to discuss planning reform.
Who is he?
The 61-year-old Labour MP for Streatham and Croydon North has significant local government experience, having led Lambeth Council for six years and turned around London’s worst-rated borough.
Born in St Albans to a working-class family, he worked in printing before entering politics as a Lambeth councillor in 1998. During his council leadership, his pro-regulation approach and struggles with major regeneration schemes will concern the market.
Rip-off culture
To add to those concerns, Reed has also expressed some strong views on landlords and agents. He has previously criticised lettings agency fees, telling Inside Croydon: “This rip-off culture among lettings agencies must end”.
He has also backed licensing schemes, supported raising Stamp Duty rates, was a strong advocate of the Renters’ Rights Bill and has been highly critical of housebuilders, accusing them of “land banking”.
He is, though, facing a challenging brief. Keir Starmer himself admitted the 1.5 million target was “too ambitious” and Angela Rayner reportedly tried to quit over the scale of the task.
The new Housing Minister has a huge and complex brief, but their first priority must be to tackle the affordability crisis.”
Richard Donnell, Executive Director at Zoopla, says: “The new Housing Minister has a huge and complex brief, but their first priority must be to tackle the affordability crisis, which is one of the biggest property-related challenge facing the UK.
“It’s the root cause of so many other problems in the market, from limiting first-time buyers’ access to homeownership to putting intense pressure on the rental sector and pushing rents higher.
“The only long-term solution to truly meet demand and ease market pressures is to build a much greater volume of homes for both sale and rent with a mix of tenures and price points, including private and social housing.
“While ambitious targets like building 1.5 million homes over the course of this Parliament are unlikely to be fully met, the focus should be on creating the right conditions to reach that run-rate by the end of it. Planning reforms are a crucial part of this, as is securing the confidence of builders.
Minister will also need to address the uncertainty created by recent speculation over possible tax changes
“The new Housing Minister will also need to address the uncertainty created by recent speculation over possible tax changes.
“This has created a ‘wait and see’ strategy among some buyers, with history showing that such speculation can impact market activity and buyer expectations. There must be a clear and steadying message to the market regarding any potential tax reforms if they are to avoid a period of prolonged stagnation and maintain consumer confidence.
Mortgage regulations review
“Finally, we must also continue the review of mortgage regulations introduced in 2015. While some easing has already begun, there is more work to be done to support first-time buyers, especially in southern England where affordability is most stretched.
“By building more homes and continuing to unlock the mortgage market, the new Housing Minister can create a market that works better for everyone, ensuring homeownership remains an achievable goal and that renters have more affordable options.”
He also needs to address the fact that new housebuilding is becoming literally unaffordable in certain areas of the country, especially London. Developers cannot make the numbers stack up, land sellers refuse to budge on price, construction material and labour costs are incredibly high, S106 taxes, CIL, BNG, water neutrality, and other costs after costs after costs burdened on developers and builders to satisfy every special interest going, and make the housing industry pay for the errors of the Government’s own regulation and certain manufacturers and installers for the Grenfell disaster . And then to cap it all, at the sales end, housing associations can’t afford to buy S106 properties as they are focusing on refurbishing their existing stock, and private housebuyers are maxed out and cannot afford to buy houses at the price the builders can afford to build. The London housebuilding market is simply grinding to a halt.
So it’s not just about easing planning rules and maybe, eventually, some reduction in the associated costs of development and the Government’s ton of flesh – expecting the private housebuilders to build social housing on its behalf. The bottom line is that housebuilding in these areas, except properties built for the impossibly wealthy, is no longer profitable, or not sufficiently profitable at a price that is worth investors’ capital or banks to risk making development loans. London is apparently the second most expensive place in the world to build a house, yet the UK is a middle-ranking economy sinking inexorably downwards. We are crippling ourselves with excess regulation and costs burdened on private housebuilders, big and especially medium and small, whilst at the same time destroying our private rental sector, and not a sign of Government letting up or investing anything near enough in social housebuilding itself.