In property news this week, the Telegraph has mentioned in one article about the government’s proposals to attempt to make amends to the UK housing market when it issued its housing white paper after months of deliberation. Let’s discuss some of these proposals and examine how they are going to help the housing market, if at all.
Firstly, the government has pointed out that it has admitted to doing a U-turn of pushing the idea of ”home-ownership for all”, as many plans to focus on this idea has so far backfired, with many unable to afford the homes on offer on the market with the ever increasing house prices causing many first-time buyers to struggle to get onto the property ladder. So the government has decided to turn its attention on the more profitable avenue of rental housing. They have begun a roll-out of government-funded rental schemes and are backing many projects for affordable housing, especially in London. This includes the burgeoning build-to-rent industry, and the promoting of the building up of apartment blocks managed by professional companies and supported by institutional lenders.
The article on the Telegraph website also notes that councils throughout the UK have to provide five-year plans detailing their housing needs. Currently, it has been revealed that out of the 293 councils in Britain, only 112 have come up with five-year forecast housing strategies. The government has handed over more power and responsibility to councils, and will penalize them if they do not put in more of an effort to remedy the lack of affordable homes in their boroughs. The white paper announced that the government would raise planning fees by 20% in order to assist councils with building new properties.
Next, the white paper issued a policy on developers, in effect imposing on them compulsory purchase orders on land, as some developers have been accused of ‘land-banking’, or sitting on land without building properties on it fast enough, which is possibly done in order for an increase in value. Even it may seem to be the harshest policy on the white paper, it is only seen as a last ditch attempt to prompt developers to build faster, but some critics say this will backfire and could lead to a decrease in planning applications. This could also prompt developers to submit applications for smaller sites as well.
The white paper included in its proposals a way for the Land Registry to wield more authority, making land ownership more transparent. The Land Registry would need to list who owns the contractual agreement to the land. The government has a target to have comprehensive land registration by 2030. this would counter developers who land bank and decide how many homes could be built. Also, the white paper alludes to a suggestion that plans and data may become more accessible, which could change the convoluted planning process.
It is hoped these changes in the white paper may actually make inroads into solving the age-old crisis, and we will see a shift in the market in the years to come.