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The sector needs a no-deal Brexit plan from government now
The actions the housing sector needs from government in the event of a no-deal Brexit are clear, if expensive. It is time to show some leadership, writes Peter Apps
Last week, one of our reporters chased a harried James Brokenshire into a taxi seeking an answer on what plans were being made for the sector in the event of a no-deal exit from the EU.
As a trade magazine, we tend not to deal in the theatrics of chasing ministers down streets and into taxis, but these are exceptional times.
Mr Brokenshire did tell us he was “working on all contingencies”. We were not the only ones left wishing for a clearer answer.
Last month, mayor of London Sadiq Khan and sector leaders from the capital co-signed a letter that issued a dire warning about the impact a no-deal Brexit would have on housebuilding and asked for a number of actions – most crucially, £5.2bn of grant to mitigate this impact.
This was, effectively, a plea for leadership and decisiveness. Sales have already slowed sharply in London. Even immediate action upon receiving the letter would have been late in the day.
But it has not been forthcoming at all.
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The official response, sent a month later, amounted to little more than a run-through of previously announced housing policies. James Murray, deputy London mayor for housing and residential development, declared himself “disappointed”. The sector may choose less moderate language.
Currently, the market challenges are largely limited to London – but it will not necessarily stay that way if we go off the cliff.
And the list of challenges for the sector in the event of a no deal – materials, labour, finance and more – extends far beyond the private sales market.
All those who build affordable homes and all those who need them require a plan for what to do. If anyone needs a reminder of how late the hour is, the government now has as long to avert a no deal or to prepare for it as we have to pull together the next issue of Inside Housing.
It is worth remembering that this entire crisis is a result of choice. It was a choice to push the sector towards a low-grant, high-risk development model in 2010. And several bad choices mean we now stare down the barrel of a no deal.
But this means better choices are also possible. Brexit itself can seem an intractable problem to which there are no easy solutions.
Not so with the consequences of Brexit for housing. Strong, decisive and, yes, expensive action is required, but the path is at least clear.
In recent months, green shoots of progress on housing policy have stalled – most significantly in the lack of movement on the proposals in the already delayed Social Housing Green Paper. The sense that politicians have been too distracted by the ‘B’ word has been inescapable.
But they must focus now. There is too little time left not to.
Pete Apps, deputy editor, Inside Housing
Read more about Brexit
Brexit and the social housing sector: the key risks As the tortuous process of exiting the European Union approaches its denouement, the country remains in a state of uncertainty about what exactly is going to happen. Peter Apps recaps the key risks to the social housing sector
Downturn: why is L&Q cutting its surplus in half and what does it mean for the sector After L&Q revealed it is likely to cut its surplus by £158m this year, Peter Apps asks what this means for the financial model which has defined the housing association sector since 2010
What housing associations are doing to stress-test for Brexit With the UK’s departure from the EU looming, Luke Barratt looks at what housing associations have been doing to prepare
Regulator writes to housing associations with no-deal Brexit warning The regulator has issued a warning to housing associations over the threat of a no-deal Brexit, outlining key risk areas including shortages of crucial materials, a housing market crash and difficulties accessing ‘business-critical’ data
Sector draws up contingency plans for no-deal Brexit The country’s largest housing associations are putting in place contingency plans to protect the future of their organisations
How would the sector cope with a no-deal Brexit? As uncertainty around Brexit mounts and a no-deal looms, Inside Housing asks what it could mean for the housing sector
Current grant system won’t work in a falling market The government needs to think again about grant to prevent housing association development from collapsing in a falling market, writes Matthew Bailes.
S&P would downgrade half its rated housing associations after no-deal Brexit The credit ratings agency Standard & Poor’s (S&P) has said it will downgrade associations it rates if the UK leaves the European Union without a deal
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