It is a truism that policy is always downstream from voter opinion.
But not all voters are equal.
For Labour to go from its worst general election result since 1935 to becoming government in a single term, they needed their vote to be highly efficient, targeting the most powerful electors.
In July, 12% of those who voted Conservative in 2019 switched to Labour, according to new research by influential think-tank Labour Together.
12% may sound small, but in our electoral system that voter bloc gave Labour the edge, propelling Keir Starmer to Number 10.
Knowing the needs of the Conservative to Labour 2024 switchers is critical for understanding a swathe of policy decisions under the new government, including those regarding the leasehold debate and the eagerly-awaited commencement of the Leasehold and Freehold Reform Act 2024.
Labour Together, once led by Morgan McSweeney, the Prime Minister’s new chief of staff, found in a report last month that tenure was strongly linked to voting Labour in July.
You basically had to be a mortgage-free freehold homeowner to vote Conservative in 2024.
Recognising the significance of precarious housing to the second biggest majority in Labour history, one can understand why this government has been agitating for mass housebuilding, a revolution in renters’ rights and, now, the liberation of leasehold tenants.
Without affordable housing, Starmer’s Labour cannot fulfil its wider mission of turbocharging growth and breaking down barriers to opportunity.
No one can expect more births and businesses when so much of people’s income is surrendered to non-productive assets like property.
In leasehold, the problem is an unaccountable rent-extraction industry, featuring freeholders and their agents and contractors who extort hapless occupiers for cash. Leasehold also embroils residents in sapping disputes.
Ending leasehold can emancipate households suffering spiralling service charges from predatory landowning and management companies.
For leaseholders, this is fundamentally a cost of living issue.
Indeed, for the Conservative to Labour 2024 switchers, cost of living is their most important issue, jointly with health.
Successive governments have promised decisive action, but failed.
So why do we expect leasehold will be eradicated this time?
Labour has clocked that the homeownership debate has become incredibly competitive and that leasehold is a hot-button issue.
In July, 84% of the electorate voted for parties – Labour, Conservative, Liberal Democrat and Reform UK – with leasehold in their manifestos. Failure to deliver leaves Labour vulnerable and will fuel discontent with our democracy.
The inescapable popularity of ending leasehold is why at PMQs, Starmer told Luke Murphy, Basingstoke’s first ever Labour MP, that his government will “act to bring the feudal leasehold system to an end”.
It is also why after slamming the Conservatives for their 2025/26 timetable to commence the Leasehold and Freehold Reform Act 2024, this Labour government has pledged in the very first bullet point of the King’s Speech briefing on leasehold that it would activate the 2024 Act “quickly”.
Leaseholders saw this as Labour establishing a clear dividing line with the Conservatives.
Also significant in the King’s Speech was the pledge of a draft Leasehold and Commonhold Reform Bill in this 2024/25 session of Parliament.
Draft legislation allows government to get the detail right, so the Bill can hit the statute books in the 2025/26 session.
Yes, the 2024 Act has already seen Big Freeholders launch two lawsuits against government, but officials are not surprised. Government is prepared for this. And the policy agenda is popular with voters, which matters.
Any law change that threatens vested interests will always attract blowback. Former Secretary of State Michael Gove warned Parliament that the legislation “is likely to face a lobbying exercise from deep-pocketed interests”.
And a world-leading University of Cambridge property law professor has intervened, saying “I can’t see this having legs. [It] looks like a political PR stunt to own supporters. And to try to delay. Reform is well within the margin of appreciation and no sleep needs to be lost.”
It is easy to forget, but last time the freeholder lobby sued government for breach of their human rights, they lost.
At the European Court of Human Rights, it was the Thatcher government defending Labour’s 1967 Act on enfranchisement against an upset Duke of Westminster.
“Eliminating what are judged to be social injustices is an example of the functions of a democratic legislature,” said the ruling.
While we understand commencement of the 2024 Act will be phased and the algorithm for the online calculator to be consulted upon, Labour is expected to deliver ahead of the Tory 2025/26 timetable.
On the deferment rate specifically, we are confident that Labour will honour the stated aim of the 2024 Act, which the King’s Speech briefing last year said was “making it cheaper and easier for existing leaseholders in houses and flats to extend their lease or buy their freehold”.
In opposition, Housing Minister Matthew Pennycook moved amendments to require the Secretary of State “to have regard to the desirability of encouraging leaseholders to extend their lease at the lowest possible cost”, which was a step too far for the Conservative government.
He warned Parliament at the time that Labour “remain[s] convinced that this government, or a future one, could be lobbied by vested interests to set a deferment rate that will be punitive to leaseholders.”
Industry are therefore deluding themselves to think that Labour will betray leaseholders by setting the deferment rate in a way that would cancel out the loss of marriage value payments.
After all, Labour were the party to first ban marriage value. And when the freeholder influenced courts snuck it back in with the Custins v. Hearts of Oak decision two years later, Labour almost immediately reversed the ruling with the Housing Act 1969. It was only reintroduced in 1993 by the Major government as a sop to the Great Estates.
We believe that Labour will be more radical on the 2024 Act than the Conservatives.
For “quick wins”, Labour can immediately commence policies such as the ban on landlords dumping legal costs on leaseholders in dispute and the new 50% non-residential premises limit for collective enfranchisement and Right to Manage claims.
We also expect the Leasehold and Commonhold Reform Bill to be enacted no later than this Parliament’s second session.
Of course, special interests including the freeholder lobby, the legal establishment, surveyors and management companies will argue that leasehold is a complex and contentious area. They claim the same on the secondary legislation for the 2024 Act.
But this is a classic distract and delay tactic, often deployed by those best served by the status quo to throw sand in the gears of policymaking.
There’s no dividend for Labour to string it out.
Leaseholders, like millions of others, voted for an insurgent government of delivery. Delivering this agenda, including enactment of the Leasehold and Commonhold Reform Bill, after 2025/26 means that Labour won’t reap the benefits at the next election.
Hundreds of thousands of leaseholder voters in strategically important constituencies will stay at home or, worse, defect to challenger parties, making all the difference in tight races.
Ultimately, Labour’s support is wide but shallow.
Similarly, at the local elections next year, they will need a positive story to tell voters living in precarious housing, including leaseholders.
Ending leasehold is an agenda that can hit the sweet spot for Labour and that is why we won’t bet against speedy activation of the 2024 Act.
