Autumn Budget 2017: Housing supply needs an almighty shove not just a nudge
In the run-up to the budget Phillip Hammond suggested he would be leading a concerted Government effort to deliver 300,000 homes a year. While some industry concerns have been taken into account, overall today’s announcements don’t match up to that ambition.
The pledged £44 billion package of housing support seems positive, but it does not represent the kind of comprehensive strategy we need, nor is it clear how much of this figure is made up of previously announced policies. Most of the announced measures are also only due to come in in 2019/2020 instead of having an immediate impact, and the Chancellor stated that we would not be building the 300,000 new homes a year until the mid 2020s, leaving the country to wait at least eight years.
Whilst the Chancellor is right to say there is ‘no single magic bullet’ to increase housing supply, it requires a lot more than the proposals he has put forward, which amount to a series of marginal and delayed ‘nudges’ at a time when housing supply needs an almighty immediate shove.
Breaking it down, scrapping Stamp Duty for first-time buyers may stimulate activity at a time when the market is subdued, but this does not tackle the underlying problem and is something of a distraction from the need to increase supply.
There are certainly some positive aspects to today’s housing proposals, however. We are pleased the Government has acted on our recommendation to lift the local authority borrowing cap for housebuilding and we hope this will herald a new era of well built, affordable council homes delivered at some scale. As far as they go, measures to provide extra support for small building firms (£1.5bn) and to speed up developments where planning permission has been granted are also welcome. Nevertheless, they are too small to make a real dent in the challenge we face.
If the Chancellor really wants to increase supply to a degree that will transform UK housing, he should implement a comprehensive housebuilding programme incorporating direct commissioning by central and local government. There should also be a more fundamental review of the planning system than was announced today, including a policy of green belt swaps so that appropriate sites on the urban edge can be considered for housing supply.
Last but not least, we have had 14 Housing Ministers in the last 19 years but in future the UK’s housing must have a representative at Secretary of State level in the Cabinet to tackle what has become the country’s No 1 problem.
Kindly shared by RICS