As the talks continue between the Conservatives and Liberal Democrats, what might a coalition housing policy look like?
Housing won’t be high on a list of priorities topped by the economy and electoral reform but it might be a promising area for compromise and there are still some intriguing differences - and similarities - between the positions of the two parties.
The good news for a working relationship is that they appear to agree on what is probably the key Conservative policy: scrapping regional housebuilding targets.
The Tories would ‘abolish the entire bureaucratic and undemocratic tier of regional planning, including the regional Spatial Strategies and building targets’ and introduce council tax incentives for communities to agree to new homes. The Lib Dem manifesto was vaguer but pledged to ‘return decision making, including housing targets, to local people’.
Both parties would stop garden grabbing. Both would allow a third party right of appeal on planning applications that go against the local plan. The Conservatives want more community land trusts while the Lib Dems want more community land auctions.
Meanwhile, the Tory pledge to protect the security of tenure and rents of social tenants and the absence of any radical plan to extend the right to buy removes a big potential source of friction.
They agree on freezing public sector pay too. If anything, the one-year Tory freeze that would not apply to people earning below £18,000 is more generous than the two-year Lib Dem plan for a maximum pay rise of £400.
As for affordable housing, the two parties already share power in England’s largest housing authority, Birmingham. Might that make it easier to agree a housing revenue account deal?
Perhaps the Lib Dems would be able to get a slightly better budget deal for housing too? The Tories did make ‘deliver more affordable homes’ part of their pledge to ‘make politics more local’ but have given no commitments at all about the budget. The Lib Dems did not exactly make a commitment but did promise that: ‘Over time, we will seek to provide a greater degree of subsidy as resources allow to increase the number of new sustainable homes being built.’
However, their priorities within the housing budget (if there is much of it left) are likely to be different. The Conservatives promise to ‘make it easier for everyone to get on the housing ladder’ while the Lib Dems identified specific cuts in the Homebuy budget.
As housing chiefs are already pointing out, the differences don’t stop there. While the Conservatives might approve in principle of what is possibly the signature Lib Dem housing policy - bringing 250,000 empty homes back into use - will they agree to pay for it?
First, it’s hard to see George Osborne agreeing to a mansion tax on homes worth over £2m when he wants to scrap inheritance tax on them. Second, the Tories mounted a sustained assault on Lib Dem plans to equalise the rate of VAT between new homes and refurbishment. If VAT stays at 17.5% (or more) on repair and maintenance then many of those conversions may be uneconomic.
The same goes for Lib Dem policies on second homes, a key concern in many of the areas where it has MPs and is challenging the Tories.
The Lib Dems want to give local authorities the option to charge higher council tax on second homes and require planning permission for new ones by creating a new use class order. The Conservatives want to sweep away use class order restrictions where development is in accordance with the local plan. Does the principle of localism mean allowing local people to decide if they want more second homes or not - or will hostile press coverage about the rights of second home owners dictate the agenda?
It’s also hard to see Tories agreeing to the Lib Dem plan to tax capital gains at the same rate as earned incomes so that people who buy homes as speculative investments pay more than 18% tax on the profit when they sell.
The prospects of the change in the public borrowing rules favoured by the Lib Dems look slim in a partnership with the Conservatives. And what will the Lib Dems make of Tory welfare reform plans?
And, perhaps above all, if things do go as far as a coalition will we get a Tory or a Lib Dem housing minister?
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