The Campbell Tickell team have put together an outline of some of the key social, political and environmental trends and events across the UK and Ireland, for organisations to keep on their radar for 2025.
Private rented sector
Increased regulation is coming via the Renters Rights Bill. This includes:
- Abolition of Section 21 evictions and Assured Shorthold Tenancies
- Extension of Decent Homes Standard and Awaab’s Law
- Creation of Ombudsman service
This will tip balance of power towards renters but there are widespread concerns about unintended consequences and the risk of landlord flight from sector. On the other hand, could it provide an opportunity for long term institutional investment in private rented housing, with long term stable but moderate returns?
The abolition of Assured Shorthold tenancies could mean major impact for supported housing unless there are amendments to allow for short term supported housing to continue and for evictions to be allowed in cases of violence or safeguarding issues.
Meanwhile, despite some reduction last year in the development of new Build to Rent homes, we expect to see the sector continuing to grow in urban areas.
Temporary accommodation (TA)
The costs of TA and number of households continues to rise (£2.29bn last year with 123,000 households in England). It is hard to see this reversing without more concerted action. The Local Housing Allowance is due to be frozen again for the next year and there will be continuing high housing demand. We await the outcomes of the Government’s Inter-Ministerial Group on Homelessness chaired by the Deputy PM.
Planning reforms
The government’s new Revised National Planning Policy Framework includes mandatory housing targets, some of which represent huge increases on previous assessments.
Councils have been given three months to confirm details of their new local plans. Other reforms around the use of greenbelt/greybelt land and measures that reduce the sway of local planning committees and residents are likely to prove controversial.
Ultimately though, getting sufficient qualified planners working for councils could have the biggest impact on speeding up development. The government has recognised this with increased funding. That said, it takes years to train planners, so can some of the new funding be made available to enable councils to compete with the private sector on pay and conditions?
Meanwhile, we await publication of the Planning & Infrastructure Bill.
Devolution and local government reorganisation
The new government has shown itself more willing to pursue substantive reorganisation of English local government than any of its predecessors over the past 50 years. The question is how long they give themselves to get the new arrangements in place. Subject to that, we can expect significant moves for greater consistency in terms of scale, powers and responsibilities across England.
This will mean regional/sub-regional unitary combined authorities with elected mayors very much to the fore, normally at the expense of district and borough councils, plus some counties. Will a smaller tier emerge below the large bodies, revamped town/parish councils and some more powers devolved than already sit at that level?
Government is pushing for a single tier of authorities each with a population of around 500,000. However, there is a backlash to these proposals (particularly from district councils), so some adjustments may be likely. Look out for potential variation of the recommended population size (350k?), plus for town and parish councils to continue.
Alongside local government unitarisation, we may well see a resuscitation of the Total Place approach introduced by the last Labour government in 2009-10, with single combined pots of funding across all local government spending areas in local areas to be distributed according to demand and need.
Local elections
The first set of local elections since the general election will be held in May 2025. Most are due among County Councils, none of which are Labour, plus some mostly Conservative unitaries and handful of Combined Authorities. A number of these will be postponed pending reorganisation.
The government’s post-election unpopularity will hit Labour’s performance, as well as being first electoral test of post-defeat Conservatives. This is expected to mean a lot of local victories for Reform and other smaller parties.
Housing regulation
New regulation came into force for housing associations and stock-owning local authorities from April 2024. While still early days, patterns have emerged and, unsurprisingly, tenant safety is paramount for the regulator, along with the need to understand stock condition and to meet service standards.
Campbell Tickell’s four main observations from work with councils and registered providers across the country are:
- The council or board needs assurance of regulatory compliance. Landlords with robust frameworks – including clear reporting, effective oversight, and rigorous checks – will be best positioned to demonstrate this co-regulatory spirit.
- The quality and integrity of data is central to the regulatory standards. It is not enough to see high performance; the governing body needs confidence in the validity of the information they review.
- Culture is key to meeting the standards in terms of centring tenants’ safety, homes, services, and voices.
- If weaknesses are identified it is critical to demonstrate transparency and capability in understanding the depth and breadth of the issue(s). It is also important to put in place realistic improvement plans and learn lessons from the presenting issues across the landlord services.
Housing development
The government’s target of 1.5m new homes (across all tenures) built within five years is hugely ambitious and will not be achieved – at least not within the current parliament. Latest thinking suggests 1.1m to 1.2m is more achievable, though sustaining even at that level would be impressive.
In addition to the planning changes highlighted here, a range of measures will be needed, such as:
- Homes England refocusing to grow the role of metro-mayors in determining how the Affordable Homes Programme is spent locally;
- Legislation to reduce ‘hope value’ and facilitate compulsory purchase orders, which would help make new development more affordable, which is likely to progress (though will face significant legal challenges);
- Genuine progress on public land being made available for development – and to be successful, this will in part require changing Treasury and Cabinet Office rules on the need always to obtain ‘best value’ (i.e. highest price) in public land disposal;
- A rent regime for social housing which allows developing organisations to rebuild their financial capacity after the years of –1% and other rent controls and freezes;
- More support for social housing fire and buildings safety work, including perhaps a VAT reduction on such activities;
- Measures to help reverse the movement away from construction jobs, including a sustained recruitment drive and new apprenticeship schemes;
- An effective and deliverable government backed strategy for modular building and other modern methods of construction.
Funding will of course be critical. The government will make available what it believes it can afford for new housing development, particularly given the central role that it sees new build housing playing in its economic growth plans. Beyond that, work will proceed on bringing together the Local Government Pension Schemes (LGPS) into substantial groups, with positive encouragement for them to invest substantively in new affordable homes.
Moreover, we can expect more institutional investment to land.
Housing investment
In addition to institutional investment from such sources as the LGPS (see ‘Housing development’ above), the UK is an attractive market for institutions investing globally based on risk-adjusted returns, especially for instance from the US. Britain is viewed as having a strong rule of law, language/cultural similarities to the US, and compelling valuations of companies/projects that are often world-class. And performing real estate is a popular asset class for US pension funds and institutional capital, which perceive it as stable, yielding, inflation-protected, asset-backed, and in an area where demand will remain high. This is about the private rented sector and the Build to Rent market. It is also about affordable housing.
There have in addition been promising signs of the potential for new investment in housing and area regeneration and in existing housing stock, particularly around decarbonisation, with new funding models being explored.
Alongside fund activity, we can expect that, in the affordable housing arena, for-profit registered providers (which do not have the building and fire safety challenges faced by traditional RPs) will be the largest developers of new homes, as they have been the past two years.
We can at the same time expect to see more for-profit RPs being registered, whether backed by institutions or developers.
Housing asset management
The old normal is long gone – those days of replacing seven components when their life cycle expired and cleaning the gutters every five years.
Most of the pieces in a jigsaw picture of the new normal are known: the minimum EPC level, the expectations about building safety and damp. The one jigsaw piece missing (there’s always one!) is Decent Homes 2. It seems likely that there are tricky meetings going on as civil servants try to arrive at a standard that makes sufficient difference, is affordable and deliverable.
Perhaps the key trend for 2025 will be collaboration. Competition will not deal effectively with supply-side shortages of people, skills and materials. Its opposite – collaboration – may.
The key to successful collaboration lies in accepting the journey heads in a new and different direction. Collaboration can feel discomfortingly different. A methodology that recognises these challenges and mitigates them will maximise the likelihood of success.
Care and support, health, homelessness
We will see continued financial pressures on supported housing and care contracts this year. The government’s long-term care plan has been extended to 2028, after Louise Casey’s independent commission has completed its review – though the first phase, on critical issues facing adult social care, is due to report next year. The idea of cross-party consensus to avoid political difficulties is laudable, but the government may need crisis actions until the commission’s reports. Meanwhile, delaying addressing the issues will impact hospitals, the NHS, families, and individuals.
On homelessness, we are in a holding pattern in 2025. RSI (the Rough Sleepers Initiative) and Housing First funding will end in March 2025, with extensions to 2026. The focus is on prevention services and initiatives that stop people becoming homeless in the first place. The medium- and longer-term funding for these and dealing with rough sleeping is unclear though. The Ministry of Housing, Communities and Local Government (MHCL) new cross-party committee and the Inter-Ministerial Group on Homelessness may provide insights.
We await the direction for policy and funding, hoping for a coherent approach addressing homelessness causes like supply, affordability, in-work poverty, and the outworkings of creaking physical and mental health, care, prison, probation and substance misuse systems.
The Renters Reform Act will also be introduced and its impact on PRS (private rented sector) housing supply is uncertain. It will nonetheless provide renters with security for the first time.
Charities
The Government has signalled that it wants to ‘reset the relationship with civil society. Towards the end of 2024, they consulted on a Civil Society Covenant, which aims to set out the terms of the relationship. This should be published soon. The ambition is for an equal partnership with civil society, where it is valued and heard. Without some concrete investment in financial terms though, will this make a significant difference to charities?
Charities already contend with the triple whammy of the increase in Employer’s National Insurance contributions, the lowering of the threshold at which employers pay and the increase in the National Living Wage. They are likely to face tough, ongoing financial pressures.
Charities cutting back on services and staff due to financial constraints is likely to continue this year. We can expect increased interest in service sharing arrangements and mergers. Polarising debates in the external world continue to challenge trustees and executive teams in relation to whether their charity ought to have a position on an issue.
A new version of the Charity Governance Code is due to be published this year, with an emphasis on this being more accessible to smaller charities. In mid-January, the Charity Investment Governance Principles (CIGPs) were also launched to help charity trustees, staff, and committee members make decisions on their investments.
Football regulation
The Football Governance Bill, currently working its way through Parliament, will eventually reach the statute book. This will be despite the behind-the-scenes efforts of some club owners to see the bill watered down.
It is unlikely to be a perfect piece of legislation (is there any such thing?), but it will offer significant improvement on the present position of what is in effect self-regulation – or indeed no material regulation at all of the men’s game in England. And we can expect the new independent regulator to look closely at club governance and financial sustainability, as well as at fan and community engagement.
The regulator will most likely be in operation from the 2026/27 season, with phased introduction of regulatory requirements for the various tiers of the men’s football pyramid.
The running of women’s football too is being reviewed at present, recognising that the poor practice in the men’s game is far worse. This is also likely to lead to change and more effective regulation.
Scotland
Late in 2024, the Scottish Parliament declared a national housing emergency, with a dozen or so local councils doing the same for their areas. This was against a background of a relatively strong owner-occupier housing market, meaning that buying a home is unaffordable for many. This is driven by the scarcity in the number of new home builds, which is at an historical low. The latest Housing (Scotland) Bill is focused primarily on tackling homelessness and on improving the conditions of private renters; it should be enacted during 2025.
Meanwhile, the Affordable Housing Supply Programme Budget for 2025/26 is set at £768m, reversing previous swingeing cuts. This supports the Scottish Government’s commitment to create 110k new affordable homes by 2032 (of which 70% is earmarked for social rent and 10% for remote and island communities). For now, demand for social housing way outstrips supply, with the numbers in temporary accommodation up 60% in the last decade.
Meanwhile the poverty and deprivation experienced by many tenants remains acute. And it must be noted that the stated target for new affordable homes is regarded as unachievable by many.
Wales
The Welsh Government has set a target to deliver 20,000 additional homes for social rent over the current Senedd term. Although this target will not be met, it has driven a significant focus on growth. As elsewhere in the UK, the backdrop to the need for more affordable homes includes significant levels of homelessness and high numbers of people living in temporary accommodation. In late 2024, a new Affordable Homes Taskforce for Wales was announced. It will explore what Welsh Government can do to facilitate development by addressing barriers including planning processes and land availability. As the country prepares for Senedd elections in 2026, the current Welsh Government will no doubt seek to secure its legacy in a variety of other ways too.
In the meantime, the housing sector continues to manage uncertainty about the implications of aspects of the Renting Homes (Wales) Act. An initial court case has found that where there has been a failure by landlords to issue electrical safety certification to contract-holders. Rent is not legally due for the period up until this situation is remedied. This is relevant to a good proportion of social landlords in Wales. A ruling has not yet been issued about whether, when rent payments have been made during such a period, they can be retrospectively recovered by contract-holders. It is expected that a case may come to court during the next six months. In the meantime, we can expect to see the sector – and indeed Welsh Government and other key sector stakeholders – heavily preoccupied with this matter, including how to reflect the associated uncertainty in financial statements.
Welsh Government continues to develop its social housing regulatory methodology, with a pilot of its new approach to regulatory assessment due to commence shortly. Consultation with tenants, sector leaders and key stakeholders has helped shape the regulator’s thinking, and we can expect to see changes which build on existing practice but equip the regulator with deeper insight into the assurance Boards have about regulatory compliance.
Northern Ireland
In common with other parts of the UK, Northern Ireland has experienced a continued rise in homelessness, with 31,000 households classed as homeless at the end of last year. Following an increase in budget for the Department for Communities, a new housing supply strategy is urgently awaited.
Work is in progress on a range of critical areas, including a climate action plan from government, with a focus on retrofitting houses and reducing domestic heating emissions. Consultation is taking place too on a fuel poverty strategy, and separately on mechanisms to deal with anti-social behavior.
The issue of improving the private rental sector has also been raised, with an MLA private member’s bill on limiting rent increases and addressing unfair letting fees.
In the context of the urgent need for new housing though, there are significant concerns about the impact that poor existing and planned wastewater infrastructure will have on social housing development. This mirrors other infrastructure challenges to new housing elsewhere in the UK, such as inadequate electricity grid access in West London and water scarcity in Cambridgeshire.
Ireland
Following last November’s General Election, the formation of a Coalition Government has introduced relative political certainty, with a new Programme for Government set to determine the strategic direction for public housing. This comes amid ongoing challenges in staff recruitment, retention, and succession planning at Board level in many Approved Housing Bodies (AHBs). There is a strong emphasis on solid corporate governance, organisational competence and purpose.
Meanwhile, the number of homeless individuals is growing, and there are issues with migrant integration. Tenant engagement strategies, activities, and quality service delivery are therefore becoming increasingly important.
The country’s ageing housing stock presents legacy issues that affect maintenance plans, while legislative and health and safety cost requirements impact assets and liabilities.
Financial pressures and gearing levels are affecting the ability of AHBs to ramp up development pipelines.
Additionally, there are IT system and data issues to contend with for many organisations, alongside advances in AI to explore.
Lastly, lessons will be applied from the Charities Regulator’s report, for example, around conflicts of interest, as well as some level of sector consolidation occurring.
To discuss or comment on any issues raised in the article, please email: comms@campbelltickell.com.
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