Natalie Elphicke OBE is the Chief Executive of The Housing & Finance Institute.

The Conservative manifesto is thoughtful, pragmatic and a radical manifesto for housing. It sets out a clear plan to build 1.5 million more homes between 2015 and 2022, improve rental standards, and build more council and affordable homes.

There are schemes for first time buyers and strong commitments to end homelessness. This is a manifesto firmly believing in the home-owning democracy. It is also grounded in the current reality of renting for many – it aims to be the renter’s friend.

This manifesto sets out a vision for the role that housing can play to support inclusion, aspiration, and affordability. It is not a programme focused on housing simply as a national economic stimulus. Indeed, the manifesto specifically states that the increase in housing supply is to “slow the rise in housing costs so more ordinary working families can afford to buy a home and bring the cost of renting down”.

This change in emphasis is a more radical shift than may appear at first sight. For coming out of the credit crunch, building housing was an important part of the national economic solution. By building more homes, the country would create a positive economic stimulus.

To achieve this, government changed a huge swathe of policy and billions of pounds of public money. The aim was to keep the wheels turning in the biggest global financial crisis ever. And in that it was successful. Housing supply is strong and repossessions have been at record lows.

However, the events leading up to the credit crunch happened nearly a decade ago. This manifesto therefore has an important role in shaping how it will we answer the current housing challenges for the decade to come. In that sense, it sends messages to industry and to councils as much as it does to the voters.

Just as the manifesto defines the role of housing at a national level as moving from an economic purpose to a social purpose, so it sends a powerful message to local authorities. There is a strong emphasis on councils building social homes for low cost renting and affordable home ownership with the new Right To Buy tenancy.

This is underpinned by exclusive extra government money, which is not available to other housing providers. In addition, councils are expected to exercise their municipal muscle for the benefit of their local areas. There will be new powers to purchase land under compulsory purchase and new powers to intervene where planning permissions are not being built out by developers.

The manifesto is not afraid to challenge the development industry and to hold it to account. From land value capture to house building standards, it can be expected that there will be significant activity from a May government. Reforms can be expected in order to increase competition and to drive improvement in planning and the built environment.

By contrast to the developers, in a purposive and directive manifesto, the housing association sector has a mixed review. They are directed to increase their specialist stock, such as for older people and inter-generational homes. It is confirmed that they will have greater ‘flexibility’, code for less controls and lighter regulation.

However, other than a rather generous line about their building record to date, they do not have such a central or defined purpose in the May manifesto.

In a sector which is itself riven with doubt about its purpose and direction in striking the right balance between commercial and social purpose, this might give pause for thought. A May government committed to social purpose and keeping rents affordable may be less receptive than previous governments to an increasingly commercialised housing association sector.

There is also recognition that the role of housing is truly national. Measures to increase housing supply across the country, not just in South East and London hot-spots, are explicitly flagged. There is a commitment to provide greater regional infrastructure and changes in how this will be delivered.

Significantly, Local Enterprise Partnerships will be given a leading role and placed on a statutory footing. They can be expected to have greater responsibility for infrastructure, growth and industrial strategy. This approach will support regions to develop and apply different finance and delivery solutions to drive growth and prosperity, including for infrastructure and housing.

One area to watch is to what extent the re-balancing of the housing agenda will have broader consequences in the capital and investment markets. There is a line in the manifesto within the ‘Homes for All’ section which refers to ensuring “more private capital is invested in more productive investment, helping the economy to grow faster and more securely in future years.” The implication being that housing investment is not that.

This would be a return to a more traditional economic analysis of housing utility. From a macro-financing perspective, this would infer a return to mortgage market-based capital investment, wholesale and institutional investment for social and affordable rented homes, and firmer action to dampen buy-to-let. In other words, financing for home ownership mortgages and affordable housing good, financing expensive rented homes bad.

It is not yet clear how or when a reallocation of capital to the business and industry sections of the economy will be achieved. It seems likely that a May government will be fully focused on ensuring that every penny drives productivity and economic success post-Brexit.

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