Gove steps down: Was he good or bad for housing? Mortgage Finance Gazette

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Critics say the causal nature that successive Conservative governments treated housing policy is demonstrated by the fact that Micheal Gove was the head of this department – twice.

He was secretary of state for levelling up, housing and communities between September 2021 and July 2022, before the person widely regarded as the most competent in the cabinet was sacked by Liz Truss.

He was brought back by Rishi Sunak in October 2022 until last Friday, when he announced he would not stand at his Surrey Heath constituency in next month’s general election.

This leaves the property industry asking one question.

Was Gove – who pushed through academies and cut back on the use of consumer plastic use as head of education and the environment – good for housing?

He famously called UK housing “broken” and said leaseholds were “a feudal system that had to go”.

While many ministers spend their careers taking on bills started by others and shepherding them through for 18 months or so, until they in turn are moved on, Gove had a reputation for initiating his own legislation and driving it through.

In housing, he pushed through a leasehold bill at the fag-end of this parliament, although he was not able to get rent reforms over the line.

In other areas of his department, his levelling up legislation of regarded as a blueprint for any administration willing to spend billions over decades to reorder the country’s resources and opportunities.

A low point, must be having to junk his housebuilding planning reforms, after his own backbenchers threatened to vote against them in November 2022.

Last year, the UK added 234,400 dwellings, unchanged compared to the previous 12 months, according to Department for Levelling Up, Housing and Communities data in November.

This is below the 2019 Conservative manifesto target of adding 300,000 homes a year by the mid-2020s.

But when the next set of annual figures are released, it is expected to be able to boast one million homes built over the course of this parliament – the current figure is 935,204.

By contrast, Labour leader Keir Starmer has promised to build 1.5 million homes over five years if the party is returned to government, through a combination of looser planning rules and green belt construction.

Gove, in his resignation letter, said that he was proud to have introduced “the most wide-ranging reforms to leasehold, social housing and supported housing in a generation”. Although, the rushed bill did not include a promised cap on ground rents.

Gove added: “We have built a million new homes in this parliament. But just as important as increasing the supply of new homes is work to make sure every existing home is safe, decent and warm.

“That is why we have introduced measures such as Awaab’s Law [two-year-old Awaab Ishak died due to damp and mould in his home], to protect social housing tenants, and given tenants everywhere a stronger voice.”

The property industry’s view on Gove:

Spicerhaart and Just Mortgages chief executive John Phillips says: “Michael Gove’s mere two-year housing legacy presents a complex picture.

The government has consistently fallen short of its goal to construct 300,000 homes each year and first-time buyers are facing the toughest conditions in 70 years.

“Average private rents increased by 8.9% over the last 12 months and yet in the face of this the Renters Reform Bill, which aimed to eliminate ‘no fault evictions,’ failed to pass.

“However, the Levelling Up and Regeneration Act enacted last year appears poised to streamline the planning process, addressing a perceived bottleneck in housing construction. Although this legislation grants councils the authority to set their own housing targets, it also facilitated Gove’s leasehold reform under the Leasehold and Freehold Reform Act.”

JLM Mortgage Network group director Sebastian Murphy points out: “Michael Gove had an opportunity to revolutionise the residential leasehold sector and improve the rights of thousands of homeowners.

“Sadly, his proposals were unrealistic and instead of introducing new stricter rules for management companies and further powers for leasehold owners to manage developments himself, he buckled under the pressure of corporate freeholders, due the changes aimed at them.

“Instead of leaving a legacy, he will leave with a whimper.”

Jeremy Leaf, a north London estate agent and a former Rics residential chairman, adds: “To frame a policy, have it discussed at length and get it almost through parliament only to find your boss has decided to call an election and then you decide not to continue in office – after all the hard work, it must be very disappointing.

“This is particularly the case with the leasehold bill as Gove had identified that as the one that would right a lot of wrongs, making it easier for those who bought leaseholds to negotiate in future and better terms for what is a very tricky area of law and property.

“The bill did have some very good parts and was a good effort, given all the interests which needed to be addressed, even if it did miss out on the ground rent provision which many thought would be included. With these things it is always very difficult to please everyone but I would give it a five out of ten and hopefully whichever government is in power after July will carry on and pick up the job.”

L&C Mortgages associate director, communications, David Hollingworth adds: “Michael Gove did show a genuine desire to bring change and overhaul elements of the housing market during his tenure.

“Leasehold reform to ban its use for new houses and to make it easier to extend the term of a lease will be welcomed by many leaseholders.

“Similar ambition and intent was there for Renter’s reform as well, although that has ultimately failed to be implemented.  While the appetite to make overdue change was evident, the supply of new and affordable homes has continued to fall behind the level of demand which continues to leave home ownership out of reach for many.”

Vouch head of customer success Lauren Hughes says: “It’s obviously hugely frustrating for the industry that Gove wasn’t able to get his flagship policy, the Renters (Reform) Bill, through the House before the election.

While there were many parts of the bill the sector didn’t like, the private rented sector is crying out for clarity and this delay simply means more uncertainty.”

Access Financial Services chief executive Karl Wilkinson adds: “Gove’s ‘brownfield presumption’ while a great idea in theory, doesn’t seem to be that helpful.  Mandating the UK’s 20 largest cities and towns to develop on brownfield land if house building falls below expected levels was supposed to create new homes where they were most needed.

“However, most cities already had planning in place for brown sites, and house-building levels have remained way below target. Fundamentally, our planning system is broken and underfunded. In the meantime, buyer choices are low and mortgages high.”