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Housing White Paper tackles big builder dominance, poor planning and renters’ woes

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  • 07/02/2017
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Housing White Paper tackles big builder dominance, poor planning and renters’ woes
The government has revealed plans to tackle the lack of competition within the house building market alongside measures to help renters in its Housing White Paper published today.

Communities and local government secretary Sajid Javid (pictured) said the government’s consultation strategy was to address the needs of different people and places, and build homes which reflected the requirements of modern living. To do this, said Javid, it would need ‘action on many fronts simultaneously’.

The paper identifies four areas which need to be addressed: local authorities failing to plan for the homes they need; house building that is too slow, a construction industry that is too reliant on a small number of big players, and improvements in the rental market.

Unified and tailor-made planning

Javid wants local authorities to plan their housing needs in a uniform way, using a government-prescribed housing delivery test. The government is proposing a new way of assessing housing needs, something, Javid said, some councils are failing to do effectively. They will be given funding to develop their planning departments, simplfy their plan-making and support infrastructure.

According to the data from the Department of Communities and Local Government, over 40% of local planning authorities do not have a plan that meets the projected growth of households in their area. Javid said many councils work with their communities to discuss the number, design and mix of housing their areas need which gets buy-in from residents, while others ‘duck difficult decisions’ and build on a speculative basis.

He wants to see a tailor-made assessment of the types of homes which are needed by individual local authorities, such as homes for the elderly, those with disabilities or young families.

Javid wants all authorities to play by the same rules and produce a plan every five years, mapping out the housing needs of their residents.

Return of the high rise solution

The White Paper sets out measures to help identify suitable sites for new homes, which will not involve loosening protections for green belt housing. It is proposing increased transparency around land ownership, to make it clear where land is available for housing and where individuals or organisations are buying land suitable for housing but not building on it. ‘High density’, or high rise was one suggestion for making the best use of land in urban areas. A review of ‘space standards’ has also been proposed.

Government land banking was also addressed. Javid said that the government should not clog up the supply of land for housebuilding. To avoid this is it plans to free up more public sector land, in a quicker timeframe.

Speeding up the rate of housebuilding

Government data shows a large gap between permissions granted and new homes built. More than a third of new homes that were granted planning permission between 2010/11 and 2015/16 have yet to be built. Javid proposes to make the planning system more open with powers passed to local authorities to hold developers to account if they have secured planning permission but do not use it.

Over-reliance on large construction firms

Javid addressed the stranglehold on housebuilding enjoyed by the UK’s largest 10 builders. He said the UK needs a diversified housing market. Some 60% of new private homes being built are delivered by 10 companies. A lack of competition in the developer market means a lack of innovation which stunts growth in new builds, he said.

The government’s proposals are intended to make it easier for smaller developers to operate in the market. The housing strategy aims to support offsite modular and factory building. It plans to partner with smaller and medium-sized builders and contractors in the Accelerated Construction programme, and help them access the loan finance they need. In return these firms will be expected to take responsibility for investing in their research and skills base to create more sustainable career paths and bring forward thousands of new skilled roles.

Renting which is affordable and fair

The private rental sector, as expected, featured among the government’s list of proposals.

The Affordable Homes Programme 2016 to 2021, which originally focussed on delivering shared ownership, will be opened up to include affordable rental homes. It wants to relax restrictions on funding so providers can also provide homes for tenants.

The paper lays out the government’s intention to encourage institutional investment into the private rental sector. It is offering a clear and stable long-term framework for investment, including products for rent. In return lenders and investors will be called on to back developers and social landlords in building more homes.

Javid said the White Paper’s measures will improve safeguards in the sector and will ‘tackle the scourge of unfair leasehold terms’. A consultation on the ban on letting agents’ fees will begin ‘early this year’.

Proposals to make the private rented sector more family-friendly come in the form of longer tenancies on new-build rental homes.

DCLG is working with the National Housing Federation and the British Property Federation to encourage longer-term tenancies in private rental homes delivered by housing associations and institutional investors.

The consultation closes on 2 May at 11.45am.

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