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Covid-19: Housing Market

Volume 676: debated on Wednesday 13 May 2020

I call the Secretary of State for Housing, Communities and Local Government, who should speak for no more than 10 minutes.

Moving home can be a life-changing moment for many among us. For young families spreading their wings after a new arrival, for young people leaving their parents’ home for the first time, or for working people changing towns or cities to start a new job, moving home means planting your roots; laying your foundations. A home is more than four walls and a roof—it is a sanctuary, a form of protection, and a link to your community.

We know that people’s homes are at the heart of their own personal stories, and throughout the course of this emergency, we have, by necessity, put many of those stories on hold, to protect our communities and to save lives. When the essential “Stay at home” message was announced, we changed the rules so that people could move home only if they thought it was “reasonably necessary”. For many people, this has put life on hold, with this most relevant and essential industry in a state of suspended animation. Over 450,000 sales have been stuck in the system, unable to be progressed—not to mention the substantial number of rentals that have not gone ahead. Every month, 300,000 tenancies come up for renewal, a proportion of which result in people moving home. The pressure to move has, for some, become acute, with profound legal, financial and health implications.

We made that decision in order to keep the country safe, but as we move into the next phase of our covid response and embark on our path to reopen, restart and renew the economy, we recognise the need to let people get back to living their lives. That is why today I am announcing a comprehensive, clear, and coherent plan to reopen the housing market and to restart the construction industry. With immediate effect, we are lifting the temporary freeze on home-moving, meaning that, as long as they are not shielding or self-isolating, anyone can move, any time and for any reason.

The industry is broad, and has many moving parts, so we want to be clear: each of the building blocks of the buying and selling process are now back in business, as long as it can be done safely. Here, then, is our plan for the reopening, restarting, and renewing of the housing market and the construction industry: estate agent offices can now reopen, removal companies can get moving again, surveyors, conveyancers and valuers can go back to work, and show homes on sites can reopen.

It is crucial that these changes happen safely and that we continue to tread with caution, to control the virus and to protect the public. This means that as these businesses reopen they will need to adapt their practices—for instance, with virtual viewings where possible and cleaning thoroughly after viewings and when moving. I have published detailed guidance, informed by public health advice, to explain how this can be achieved, building on the existing safer working guidance, with all parties observing hygiene measures and social distancing guidelines.

For each of the other elements that make up the wider construction industry—a sector that employs more than 2 million people—the same applies. If people are self-isolating or have coronavirus, they should of course not be moving or going back to work. All parties involved in home buying and selling should prioritise agreeing amicable arrangements to change move dates for individuals in this group.

This is the most radical restarting of an industry in the first phase of our national recovery road map. It was not an easy decision to make. With few, if any, transactions, there is no visibility and no precedent with which to accurately judge the state of the housing market, but I do know that in every economic recovery in modern British history the housing market has been key, so let me be clear to all who work in the sector, have started a business in it, have invested in it, or rely upon it: I am doing everything I can to help the industry bounce back.

A healthy housing market means more than buying and selling houses; it requires building them too, but covid-19 has had a profound impact on housebuilding, with activity on sites down by around 90% since this time last year. I am delighted to see so many construction companies back at work already, and I am pleased to be supporting their efforts by today announcing the launch of a safe working charter with the Home Builders Federation. Those working on site should feel confident that their essential jobs are also safe jobs.

I am taking further steps to support safe housebuilding by allowing more flexible working hours on construction sites, where appropriate and with local checks and balances. I am allowing sites to apply to extend their working hours, again with immediate effect. Varied start and finish times will make it easier for sites to observe social distancing, will take pressure off public transport, particularly in our core cities, and will keep Britain building.

The planning system, too, must be able to operate safely and efficiently during this time, which means, as with many other sectors, making more use of digital technology. I want the Planning Inspectorate to be at the forefront of this work—it is good to see the inspectorate now undertaking its first virtual hearings. I am asking it to make all hearings virtual within weeks. We are going to get the planning system going again and bring it into the digital age at the same time.

As we look to the future, we must remember that the prospects of Britain’s housing market is key to our economy: when this sector succeeds, we all succeed. This is what shapes our vision for the housing market: more homes, safer homes, homes of higher quality, more beautiful homes, homes of all types and tenures, for all people, rooted in and at the heart of their communities. Today, we reopen, restart and we renew the housing market and the construction industry to protect lives, save jobs and refresh and renew our economy.

Thank you Mr Speaker, and I thank the Secretary of State for an advance copy of his statement.

The Government said that they would do “whatever it takes” to get the country through the covid crisis and protect the most vulnerable. The Opposition want the Government to succeed. Lives, livelihoods and homes are on the line. In a spirit of constructive co-operation, we have scrutinised plans carefully and offered suggestions and challenges when appropriate, to try to help to bring down infections and the numbers of people who are infected or who are tragically dying, and to help people manage financially. Sometimes the Government have heeded our calls, sometimes not. I would like them to consider these.

Today’s announcement provides welcome news for some—and of course we all want new homes to be built —but it leaves more unanswered housing questions, which urgently need Government attention to keep people safe at work and at home, as we do not have community testing, a cure or a vaccine and there are still problems with personal protective equipment. What protection will there be for people who rent, if a landlord or an estate agent wants to show a prospective buyer or new tenant around? What will the Government do to help those trapped by the cladding and leasehold scandals at this time? What discussions have the Government had with the trade unions? There was no mention of that in the statement. What advice do the Government have for anyone who feels that their workplace or construction site is not safe?

This crisis has taught us that if anyone is struggling, we are all affected. The announcement focused on those who want to move home, but it ignored those who are at risk of being forced to do so. The Secretary of State talked about show homes, but not about people with no home. We have shown that when we work together we can virtually eliminate street homelessness in days. There must be no going back, but people in emergency accommodation face that. Will the Government work with councils and homelessness organisations on the issue of how to provide and pay for a “housing first” approach, so that we can end street homelessness for good this year?

The Secretary of State said that he knew that homes were sanctuaries, but there is no plan for what happens when the temporary ban on evictions ends. We need to prevent people from falling into arrears, so will the Government heed Labour’s calls to fill gaps in the financial support schemes? Will he guarantee that the local housing allowance will stay at 30% of market rent? Will he consider raising it further until the crisis eases?

People who are struggling with their rent are worried about what will happen when the ban lifts. The Government say that they are

“working with the Master of the Rolls to widen the existing ‘pre-action protocol’ on possession proceedings for Social Landlords, to include private renters and to strengthen its remit”.

That is not enough, so will the Secretary of State consider Labour’s proposal to halt section 8 evictions on the grounds of arrears caused by the lockdown?

In March, Ministers said that they would provide

“whatever funding is needed for councils to get through this and come out the other side”.

That pledge has been repeated by the Secretary of State. This week, however, he told the Housing, Communities and Local Government Committee that councils should not

“labour under a false impression”

that all costs would be reimbursed. Which is it? Will the Secretary of State honour his original commitment to councils?

The Under-Secretary of State for Housing, Communities and Local Government, the hon. Member for Thornbury and Yate (Luke Hall), appeared to require local authorities to provide accommodation for people with no recourse to public funds but without funding, leading to confusion and people being left out. Will the Secretary of State ensure that there is specific funding for housing people with no recourse to public funds?

Councils cannot borrow for revenue spending or run deficits. If they cannot balance the books they have to stop spending. They are currently £10 billion short—a fifth of council spending. They could close every library, leisure centre and children’s centre, turn off all the streetlights, and lock the gates to parks, and they would still be billions of pounds short. They would have to make cuts to social care and public health at this time. Will the Secretary of State ensure that councils are fully recompensed for housing and other costs in this crisis?

Finally, during the crisis we have all become aware of people in overcrowded, unsafe homes, who are unable to self-isolate and worried about the rent. We know how bad it is for mental and physical health when families have no outside space. The Secretary of State says that he wants “more homes, safer homes, and higher quality, more beautiful homes”, but he does not say how he will ensure that they are higher quality, or safe, or beautiful. He could have decided to invest in high-quality, safe, beautiful, socially owned, zero-carbon, truly affordable housing. That would capture the national spirit and turn it into building our future.

Instead, the Government have focused on private house sales and even today asked councils to allow developers to defer section 106, the community infra- structure levy, which is likely to reduce the numbers of new social and affordable homes. Will the Secretary of State please work with the Treasury, housing associations, local authorities and the building industry to invest in high-quality, truly affordable social housing?

Our broken housing system has been brutally exposed. Key workers we applaud each week live in poor housing. They have been left behind too long. We must not go back to business as usual. We must solve the housing crisis for all our heroes and for our country.

I welcome the hon. Lady to her new role and look forward to working with her constructively in the weeks and months ahead. I am pleased that she supports the overwhelming direction of our statement today, and recognises the importance of the housing industry and construction in this country. She asked a number of questions and I will endeavour to answer as many as I can.

On the important question about building safety, I have been clear from the onset of the crisis that that work should continue. That was, in fact, opposed by many on the Opposition Benches, who said it was too risky, but it was the right decision to encourage ACM cladding and other essential building safety works to continue. I am pleased to say that it is now gradually starting to begin again. I welcome Mayors such as the Mayor of London, the Mayor of Greater Manchester and the Mayor of Birmingham coming together to support that in our combined pledge.

On rough sleeping, I pay tribute to everybody who has been involved in the tremendous national effort so far, bringing 90% of the people sleeping rough on our streets at the onset of the crisis into safer accommodation. Now, we are in the next phase of that challenge. I do not underestimate how difficult that will be, protecting those individuals while they remain in that accommodation during the lockdown and then preparing for them to move into more suitable long-term arrangements with the wraparound care that they need and deserve. That will be a true national effort involving charities, councils and businesses across the country.

With respect to renters, today’s announcement is very much about renters. Every month, 300,000 tenancies come up for renewal. Many of those individuals need or want to move house. Today will enable them to do just that and to do it safely, which is the most important consideration.

On the guidance I have published today, it sets out that physical viewings of homes, whether for sale or for rent, can go ahead, but those will need to be done in accordance with social distancing guidelines. In most cases, that will mean that the tenant or the homeowner will not be present in the property. They will be in the garden or will have gone out for their daily exercise. If they are in the home for whatever reason, they will be in a different room and ensuring that they are 2 metres apart from the individuals who are looking around the property. That is the right thing to do.

On the concern about people being evicted from their properties, as the hon. Lady knows we have changed the law to have a moratorium on evictions, so that no possession proceeding can continue. That will go up until June, at which point I, as Secretary of State, have the ability to extend that if we need to. We will be taking that decision very carefully. We will also be proceeding with the pre-action protocol, working with the Master of the Rolls to ensure that that provides an added degree of protection for those individuals. I do not support the Labour proposal, which is to encourage people not to pay rent and to build up potentially unmanageable degrees of debt, so that in six, nine or 12 months’ time, their credit rating would be shredded and they would be in a very difficult financial position. We are developing a much more credible plan to protect renters and to help to shield them through this crisis.

Finally, with respect to councils’ finances, I said we would stand behind councils and give them the funding that they need, and we are doing exactly that. Today, the Prime Minister has announced an extra £600 million, bringing the total investment in our councils to £3.8 billion in just two months.

The Secretary of State is right to talk about people living their lives. Most of the people going to new homes will be going to leasehold ones.

When will he, and we, act to ban the sale of leasehold and pre-sold houses? When can he announce actions for justice for leaseholders and lease renters who are stuck with excessive ground rents?

Can he advise residential landlords and smart developers that the financial games are over, and that the leasehold knowledge campaign and the all-party group on leasehold and commonhold reform are going to make sure that there is justice for leaseholders?

I am grateful to the Father of the House for that question. I pay tribute, once again, to his campaigning over many years against rip-off practices in the leasehold sector. We are committed to bringing an end to those practices, to legislating to bring ground rents down to a peppercorn, and to ensuring that no new homes are built as leasehold properties except in the most exceptional of circumstances. We will shortly be bringing forward draft legislation for scrutiny. I am pleased that, in general, such practices have reduced enormously as a result of the Government’s firm stance and that of campaigners, including many Members across the House. I want to see that continue.

I, too, thank the Secretary of State for advance sight of his statement—although I think I read most of it in the morning papers. I want to focus on the part announcing a “clear, coherent” plan. This is an issue that many of us have found, whether with his statement or the statement before it on education. The position in Scotland remains unchanged: people should protect the NHS, stay at home and save lives. This Government often announce big decisions without making it clear that they do not apply to people in Scotland. We in Scotland will take the decision about when to lift the lockdown based on science and when it is right to do so, so I would appreciate it if the UK Government would be more explicit in making it clear that this is for England only.

There are elements of this that I am puzzled by, particularly some of the restrictions that are being eased, because we are saying to people that they cannot see both their parents at the same time, but they can welcome two complete strangers into their home. It also does not make sense that kids cannot go out and have a kickabout with their friends in the next garden, but removal men can come into the house, potentially passing on the virus. Those are just two examples of how this does not necessarily stack up. From a messaging point of view, we have gone from saying on Saturday, “Stay at home, protect the NHS, and save lives,” to saying four days later, “You can traipse around any random stranger’s house.” Will the Secretary of State take this opportunity to make it clear to people in Scotland that the message remains the same: “You should stay at home, protect the NHS and save lives”?

I made it clear repeatedly in my statement that these arrangements apply to England. The Scottish Government will have to come to their own decision and be held accountable for it. With respect to social distancing, the guidelines are extremely clear, so I would be grateful if the hon. Gentleman and others did not purposefully mislead in that respect. Removal men and women, agents and those visiting other people’s homes need to respect the social distancing guidelines, which means staying 2 metres apart and using protective equipment where appropriate, as we set out in the guidance. For residents, that means being out of the home, in the garden or in another room at the time of the viewing, so that they do not come into contact with those visiting the property. That approach has been fully signed off by Public Health England and all the medical and scientific experts.

I thank my right hon. Friend for today’s welcome announcement that estate agents in Stafford can now reopen and that viewings can resume. Many of my constituents were in the house-buying process when covid-19 hit and will very much welcome this certainty. What steps will be taken to ensure that my constituents can undertake viewings safely and that estate agents can be sure that they are in line with the new Government guidance?

I am grateful to my hon. Friend for that question. I am sure that thousands of people in Stafford, and across the country, will have been in a state of limbo and unable to move home. This announcement today will make a big difference to their lives and to the local economy in Staffordshire. With respect to the guidelines, they are clear, as I have already said, that people need to respect social distancing when in others’ properties. We are encouraging virtual viewings, which can be more sophisticated and may come at a cost, or can be as simple as the agent or homeowner producing a video on their smartphone and making it available to anyone interested in the property before they visit. With respect to show homes, we are strongly encouraging people to attend by appointment only to avoid unnecessary speculative visits.

We now go over to Sheffield to the Chair of the Housing, Communities and Local Government Committee.

I welcome much of what the Government have proposed, particularly the help for private tenants. However, we should recognise that many tenants’ rent arrears will grow over time, causing problems not merely for them, but for small private landlords. Will the Secretary of State consider a scheme like the Spanish Government’s, which offers low-interest loans to tenants to help them to pay the rent and the landlords to receive it? As for the market for new housing, if demand for new homes falls, will he consider increasing grants to housing associations and councils so that they can help the construction industry keep going by building more social homes for rent?

With respect to supporting the industry, today is too soon to judge with confidence the state of the housing market because there have been so few transactions in recent weeks. However, we stand ready to work with the industry and to help to guide it through what will undoubtedly be an extremely challenging period. We have announced some measures today—for example, enabling councils to defer CIL and section 106 payments. That does not mean that there will be an impact on social infrastructure or affordable homes in the longer term, but it does mean that small and medium-sized enterprise builders in particular can have a bit of breathing space in the weeks and months ahead, which is a critical lesson learnt from the last downturn in the market.

We are thinking carefully about what more we can do to protect renters. Of course, there are other Government schemes, such as the furlough scheme, which is now paying a proportion of millions of working people’s wages and helping to support them through this difficult period. The moratorium on evictions prevents possession proceedings in court at the present time, but we will need to think carefully about what to do when that comes to an end in June.

My right hon. Friend knows that the construction industry is core to our economy’s success. Will he outline what steps the Government are taking to ensure that that important sector has the flexibility that it needs to operate safely and restart?

Across the country, millions of people are employed in the construction industry. It is absolutely essential that we get them back to work, but we have to do so safely. Today’s charter, working with the house builders, will set out ways in which we believe that that can be done. Many of the country’s house builders have been working with us in recent weeks to put in place the protocols and site working practices that will be needed to protect those working people.

Today’s written ministerial statement, extending the work of sites, will also play its part. It will enable sites to stay open during the summer months, potentially to 9 pm in residential areas, and longer than that in areas where there are no neighbouring properties. This is to help the industry to catch up if it wants to and, above all, to help it to put in place the social distancing rules that it will need to operate sites safely and reduce pressure on public transport. I hope that all of us across the country, and our councils, will support that and ensure that it is implemented smoothly.

May I press the Secretary of State on the issue of the cliff edge facing many in the privately rented sector? What action will the Government take to avoid mass homelessness as the moratorium on evictions lifts and we emerge from the covid-19 crisis?

As I have already said, we have legislated to have a moratorium on evictions, which comes up for review in June. At that point, the Secretary of State has the power to extend it if necessary. We will take that judgment on the basis of the market at that time and the evidence we see in respect of how many individuals might be coming before the courts with eviction proceedings. We will consider what further steps might be necessary at the time.

I thank my right hon. Friend for his statement. In order to provide the reassurance and clarity that my constituents in West Oxfordshire would like, will he confirm that although people can move whenever they like and removal firms are able to help, the Government do still ask and require that such activity is carried out safely?

It is extremely important that removal firms across the country, many of which are small and medium-sized businesses, get back to work, and we have worked with them to produce guidelines that we believe will enable them to do so safely. We may do more work in the weeks and months ahead to learn from that. These businesses play a critical role in the industry.

At the beginning of this crisis, the Secretary of State said “Everyone in”, and that he would fund councils to end homelessness. Since then, it has been suggested that that might not apply to those with no recourse to public funds. That is nonsense: the virus could not care less about someone’s migration status. Will the Secretary of State take this opportunity to clarify that when he said everybody he meant absolutely everybody, and that he will be providing funding to make sure this happens?

I am extremely grateful for the work of local councils and charities in places such as Nottingham: they did an amazing job in bringing at least 90% of those individuals who were sleeping rough at the onset of the crisis into safer accommodation. In some parts of the country, the numbers of rough sleepers have now fallen to as low as one, two or three individuals. We believe that the success rate could even be as much as 98% so far, but the challenge is by no means complete and there is more work to do. We have said that the Government’s policy on no recourse to public funds has not changed, but councils do have flexibility, as they know, to support those individuals when there is a risk to life and serious concern. They should behave humanely and compassionately.

I welcome the statement. What advice does the new guidance offer for those following the chief medical officer’s advice to shield in their home?

My hon. Friend raises a very important point that we cannot emphasise enough today. There will be individuals who are not advised to move home, except in the most unusual circumstances. The people we have asked to shield—those people who have extremely high levels of vulnerability to the virus, as identified by the chief medical officer—should continue to do so. They should stay at home and have as little face-to-face contact as possible. Now would not be the right time for them to move house. If they absolutely have to, they should take medical advice before doing so.

This morning, I saw the Secretary of State’s social media posts on the easing of restrictions; every comment and reply from members of the public that I saw highlighted contradictions and inconsistencies. On top of that, a shocking YouGov poll found that only 30% of respondents believed that the UK Government’s instructions to stay alert were clear. That suggests that the Government have a major problem with communication. Does the Secretary of State think that the Government’s recent communications have been clear? Will he confirm, yet again, that this easing applies only in England?

This is one of the most comprehensive, coherent and clear plans for any sector of the economy. We have worked with every part of the industry, from the removal companies, estate agents and letting agents to the surveyors, conveyancers and builders—you name it—to put in place the guidance that is needed, and it has all been published today on gov.uk. It has been hugely welcomed by people across the industry and the millions of people in England who want to move house and get on with their lives, as well as the 2.3 million people whose jobs depend on this critical industry.

My right hon. Friend was dead right to say in his statement that we need to build homes before we can buy and sell them. What can he do to unlock the market in Hampshire, where a stand-off between Natural England and local authorities over nitrates in the Solent—a subject which the Secretary of State knows about—has had planners, developers, architects and investors tied in knots since long before covid-19? Perversely, it is encouraging greenfield development over brownfield.

My hon. Friend and I have discussed this issue at length on a number of occasions, and he has been assiduous in campaigning to break this deadlock. It is extremely unfortunate that before the coronavirus crisis house building in the Solent area was essentially paused because of the issue he described. I have been working with the Department for Environment, Food and Rural Affairs and Natural England to bring forward guidelines and to bring the parties together, because too many people’s livelihoods depend on this and we need to move forward. I hope that those guidelines are now available and will ensure that we continue to work with his local council and others to get the industry moving in the Solent area.

Sitting suspended.

On resuming, the House entered into hybrid substantive proceedings (Order, 22 April).