The Government announced its new ambitious housing white paper ‘Fixing our broken housing market’ on 7 February with the Communities and Local Government Secretary, Sajid Javid, unveiling the plans to the House of Commons.
Sajid Javid commented in his speech that the current housing market is broken and that it is letting first-time buyers down with house price-inflation outstripping the rest of the OECD.
The white paper aims to improve affordability, address the shortage of houses and improve the slow house building market.
The reforms that have been proposed include a standardised way of calculating housing demand by asking local authorities to produce an effective housing plan that they will have to review every 5 years. This would enable a positive balance between protecting the green belt and to help ensure that enough homes can be built where people want to live.
Planning permission currently allows developers up to three years before they have to commence building. The white paper proposes to change that to two years in order to speed up house building and give local authorities the power to issue completion notices on developers who are not keeping to their timescales.
Over 60% of houses in the UK are mainly built by just 10 companies. However, under the £3 billion Home Building Fund, the government will provide loans to SME builders and developers in order to stimulate further new home builds before the end of this Parliament. SME builders and developers will contribute up to 25,000 new homes before 2020; leading up to 225,000 in the longer-term.
Sajid Javid, Communities Secretary, commented in his speech to the House of Commons:
“We have seen almost 300,000 affordable home units built in England. We have seen housing starts increase sharply. And we have seen more people getting on the property ladder thanks to schemes such as Help to Buy.
“Now we need to go further, much further, and meet our obligation to build many more houses, of the type people want to live in, and the places they want to live.
“That’s exactly what this white paper will deliver.”
Other measures that have been set out in this white paper include:
- Lifetime ISA, whereby young adults can save up to £4,000 per year, and the government will give them a 25% bonus on those savings. The savings and the bonus can be put towards the purchase of a first home or withdrawn at the age of 60.
- Planning rules will be amended so that local authorities can plan for more Build to Rent homes. A consultation will be launched to look into longer-term tenancies in the private rented sector to provide stability to families.
- Further plans to increase brownfield developments under ‘Urban Regeneration’.
- Increase local authorities’ power to bring empty homes back into use, by allowing the powers under the New Homes Bonus to impose an additional 50% premium on top of a council tax bill for properties that have been empty for more than two years.
Amber Rudd, MP for Hastings and Rye, commented:
“Here in Hastings and Rye I speak to residents who tell me that they cannot find alternative housing, either due to financial circumstances or a lack of supply. I believe that this white paper will help to alleviate this and I look forward to seeing it make a real difference to the lives of local people.”
Notes to editor:
You can find more information on the ‘Fixing our broken housing market’ white paper here: https://www.gov.uk/government/news/government-announces-ambitious-plan-to-build-the-homes-britain-needs