February 08, 2017
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| Will these measures help solve the housing crisis? CREDIT: BLOOMBERG |
It ultimately suffered from this and appeared to many as rather a damp squib. While communities secretary Sajid Javid described it as "radical", there was a lack of detail, with the white paper adopting a distinctly green tinge.
How are the proposed measures likely to work, and will they help fix the "broken" housing market?
Embracing the rental sector
The boldest move in this white paper is the Government’s ideological turnaround from pushing a policy of ‘home ownership for all’ to promoting and funding rental schemes and affordable housing. Of particular note are policies supporting the burgeoning build-to-rent industry; measures in the white paper include promoting the building of apartment blocks managed by professional companies and backed by institutional lenders.
This part of the industry has been hit by the 3pc hike to stamp duty in April 2016 and needs support while it establishes itself. It is one of the most dynamic parts of the market, with a lot of financial firepower and enthusiasm for so-called modern methods of construction, or pre-fabricated homes, which is also being heartily promoted by the Government.
Crisis solving score: 4/5
Holding councils accountable
As well as hitting house builders, councils will be forced to provide comprehensive local plans calculating their housing needs that will have to be revisited every five years. Of the 293 local authorities in England outside London (which has its own central plan), only 112 have currently have one.
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| The councils which have so far completed their five-year plan for housing supply CREDIT: NATHANIEL LICHFIELD & PARTNERS |
This is a “significant burden” on councils, according to Lucian Cook, head of residential research at Savills, and those that don’t submit them and stick to detailed timetable will get “caned”, suggested Sir Edward Lister, the Homes and Communities Agency chairman. Central government is in effect handing off more responsibility to local authorities, and it plans on holding them accountable.
The white paper will also give them the power to raise planning fees by 20pc, a timely measure to speed up the process in underfunded and overworked councils - and some of the only new money announced.
Crisis solving score: 3/5
Hitting developers
The Government raised the spectre of imposing compulsory purchase orders on developers which 'land bank', which sit on land with planning permission but don’t build on it quickly enough, often to increase its value.
The ‘use it or lose it’ policy is designed as a last ditch measure, but one which would worry house builders, and could lead to fewer planning applications. Adam Challis, head of residential research at JLL, said: "We wouldn't attack the stock of raw materials for other manufacturing industries; this issue is misunderstood. Policies that increase the risk of holding land will undermine the objective of increasing the number of homes that are built."
Other measures to force an increase in the rate of building on sites once it is started could be equally counter-productive, particularly for SME builders, and could lead to developers submitting applications for smaller sites.
Crisis solving score: 2/5
Increasing transparency in who owns land
Hidden in the white paper is the plan to beef up the Land Registry, making the ownership of land more transparent. This includes listing who owns the option, or contractual agreement, to the land. The government aims to achieve comprehensive land registration by 2030.
This will go some way to countering ‘landbanking’, and calculating just how many homes could be built. There was also a hint to make plans and data more accessible, which could open up and democratise the labyrinthine planning process.
Crisis solving score: 3/5
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