Responding to today’s Budget announcement, Localis
chief executive, Liam Booth-Smith said:
CPO powers and mass land buying
“Making cities like Oxford and Cambridge bigger is a great idea.
To bring this policy forward, the Prime Minister should direct
the Homes and Communities Agency to begin purchasing land where
it can ensure a more productive use than existing owners.
“There is appetite operationally to do this – it just requires
clear direction from the heart of government.”
Inquiry into developer land-banking
“An inquiry into land-banking is to be welcomed to the extent
that it can effectively feed into greater transparency and shine
a light into the near monopolistic behaviour among major
developers that is not only stunting the amount of housebuilding
nationwide, but also restricting choice and quality of housing as
a consumer product like any other.”
Guarantee loans to small builders
“Big builders are not incentivised to construct homes on a scale
that has any chance of resolving the housing crisis, and we need
new entrants in the housing market.
“However, the number of small builders has collapsed by
three-quarters from 12,000 in the late 1980s to less than 3,000
today, a situation exacerbated since the 2008 financial crisis by
a squeeze on commercial lending, forcing an increased reliance on
mezzanine financing to unlock developments.
“While guaranteed loans are helpful, government has a bigger role
to play in market making for the SME developer industry by
bringing forward more land with simplified planning and allowing
permitted development for a greater number of small sites,
specifically on those considered brownfield land or infill.”
Local authorities’ flexibility to borrow for council
houses
“The reality of the situation is that last year just 1,490 homes
were started by local authorities. As these numbers suggest, the
majority of local government is not set up for the large-scale
construction of housing anymore.
“In context, an extra 100,000 more council homes built per year
would mean the sector uprating its output by 5,435% – a
staggering uplift.
“While these individual planning deals are a positive step
forwards, if government wants a new generation of new council
homes it must empower, resource and direct local authorities
accordingly.
“Practically, it would take a fundamental shift in the mind-set
and financial model of local authorities, the granting of greater
powers over the compulsory purchase of land and a comprehensive
relaxation of Housing Revenue Account borrowing rules.
“As things stand there is little evidence to suggest there is the
capacity, resource or expertise for them to build at a scale or
pace that would meet demand.”
Skills fund for bricklayers and electricians
“In itself the skills fund is a worthy scheme for helping the
construction industry rise to the challenge of meeting demand,
but if the government is serious about meeting their housing
targets, serious consideration must be given to new methods of
construction and modular, off-site homebuilding on an industrial
scale.
“Perhaps taking an interventionist lead from how Lord Beaverbrook
transformed the manufacture of aircraft during World War Two, the
government should itself disrupt the housing industry by funding
and building factories capable producing modular housing to
deliver off-site homebuilding at great volume. Furthermore,
these factories should be sited in parts of the country so as to
align with the national industrial strategy.”
Removing stamp duty for first time buyers
“The decision to exempt first-time buyers from Stamp Duty charges
is to be welcomed in that the liabilities arising from this levy
can often, alongside estate agent fees, present a serious barrier
to home-ownership.
“The main barrier to home-ownership remains a chronic inability
of young people to save anything or enough from their monthly pay
packet to save towards a deposit.
“Research from Localis finds that fifty-eight percent of people
who do not already own their home outright or with a mortgage are
saving nothing at all each month for a deposit to buy a home in
the future. Just twenty-three percent are saving anything towards
a deposit.
“If government makes the choice that the home-owning democracy is
something worth preserving—as it has and should—then it has to
take a more muscular interest in deposit saving.
“Otherwise, the great intergenerational divide of our time will
only become deeper entrenched: where only the very old and very
rich can afford to be very wealthy.”
New roads and infrastructure to unlock land for
housing
“Uncertainty in the planning and development process is a
consistent enemy of housebuilding, and the promise of extra
funding, through the Housing Infrastructure Fund, for new roads
and infrastructure to large strategic sites can only help deliver
greater certainty at all stages of the planning process.
“Since the Housing Infrastructure Fund is so heavily
over-subscribed, it is to be hoped that in next year’s Budget the
capital grant fund expands to meet the number of bids that can
viably prove funding would unlock the delivery of new homes.”
