Buy-to-let landlords find loophole to avoid tax changes

Another story in the Sunday Telegraph Business section is that buy-to-let landlords (who control properties all over East Devon, particularly Cranbrook) have realised that to avoid extra taxes announced last year all they have to do is incorporate companies and take advantage of the reduced corporation tax and other opportunities.

Although there are costs to this route, and they mostly benefit higher tax band ps, there are worthwhile tax advantages for anyone who owns 10 or more properties.

In any case, with all such landlords, any increased costs will be passed on to increased rents.

Exeter (and by extension its environs) in top ten least affordable cities

“Truro tops the South West list as the seventh least affordable – though many non-city areas could lay claim to worse affordability – with a ratio of 9.11.

It is followed in tenth place by Exeter where average house prices now stand at 8.36 times average earnings.

Devon and Cornwall’s only other city, Plymouth, was not featured in the top fifteen least or most affordable cities.

Affordability in UK cities is, on average, now at its worst level since the average house price to earnings ratio rose to 7.2 at the height of the last housing market boom in 2008.”

http://www.plymouthherald.co.uk/Truro-Exeter-affordable-cities-buy-home/story-28998321-detail/story.html

“Labour predicts “profound defeats” for government over housing bill”

“More humiliation could be in store for the Government after Labour warned it faces “quite profound defeats” over its flagship housing reforms.

Labour peers in the House of Lords are threatening to “make life difficult” for Tory ministers over legislation that will rebrand “affordable housing” to include homes costing up to £450,000 in London – and £250,000 outside – and end the principle of lifelong, secure tenancies for council home tenants.

Amid the huge fall-out over the Budget, Lord Steve Bassam, Labour’s chief whip in the Lords, told journalists the Government could face “between eight and a dozen major defeats” on the Housing Bill.

After being nodded through by MPs, the legislation starts to make its way through the House of Lords next month. But Labour has indicated it will use its clout to thwart what it says will fail to tackle the “housing crisis”, and will seek a series of compromises.

The unelected House of Lords has been a repeated thorn in the side of the Conservative government, inflicting upon it a series of defeats because of the Labour-Lib Dem “anti-Tory” majority in the upper house.

The embarrassing defeat over tax credits in the Lords, which forced George Osborne into a U-turn over his welfare reforms, was fuelled to a large extent by anger among peers that the Government had laid a statutory instrument to force through its plans – a move which bypassed a debate among MPs.

This time, however, Labour argues its opposition is driven by a “flawed policy on all fronts”.

Other measures in the Bill proposed, and criticised by Labour, includes so-called “pay to stay”, which will see rent hiked for higher-earning social tenants, and an extension of “Right to Buy” to housing associations that could undermine housing stock.

The Lib Dems have already signalled they will oppose the Bill in the Lords as it is “riddled with holes and unfairness”, and Labour claims some Tory peers are unhappy – notably over ditching restrictions on house-building in rural areas.

Lord Bassam told reporters: “The Government faces the potential of between eight and a dozen major defeats on this Bill. I think they are going to have to re-think quite a lot.”

“What you will see is quite profound Government defeats on this Bill.

“I don’t like to predict bills falling foul of the Lords because it is not always a given, but this is a Bill in a mess.

“We will do our utmost to make life difficult for the Government with this Bill because, frankly, it is going to make the lives of people who are in council tenancies and who want a starter home no better. It doesn’t answer the housing needs of our nation.”

Labour MP John Healey, the party’s spokesman on housing, added: “There is a certain amount of political panic among the Government.

“They are setting themselves house-building targets they are getting nowhere near. Homelessness is rising through the roof. Home ownership is in freefall.

“And they’ve made some extraordinary promises that even in the first year of government are a long way from meeting.

“There is no conviction from anyone that this Bill meets the housing crisis.”

http://www.huffingtonpost.co.uk/entry/labour-housing-bill-lords_uk_56f1831ee4b030d552f01636

Government guidance on disposal of local authority assets

Disposals

“Where land or property is identified as surplus, there are some important principles which will help ensure that land is disposed of effectively and efficiently. These include;

Every disposal having clear objectives from the outset.

These should establish the key objectives and targets for land disposal – for example, this could be to maximise housing capacity, receipt or employment floorspace, or to reduce costs through divestment.

Disposals rooted in local plans.

Land disposals should help deliver local planning objectives, addressing matters such as the requirement for a five year land supply, or the assessed need for housing and employment land.

Early and meaningful engagement with other public bodies and the market.

Early engagement with other public bodies will ensure that the views of all authorities with an interest can be taken into account, so that land is used as efficiently as possible. Early market engagement should inform the disposal strategy and brief, and ensure the opportunity is attractive to the market.

The appropriate level of investment determined prior to disposal.

To ensure the best possible return, in many cases it may be appropriate to invest in a site before disposal, for example by obtaining planning permission or providing infrastructure. The appropriate type and scale of investment will depend on the individual circumstances of the site, and understanding these early will ensure the best outcome for authorities.”

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/508307/160316_Land_disposal_guidance.pdf

Housing Minister to be questioned by Lords’ Select Committee this afternoon

” The Economic Affairs Committee holds the final public evidence session of its inquiry into the economics of the UK housing market by taking evidence from Housing Minister, Brandon Lewis, and Exchequer Secretary to the Treasury, Damian Hinds.

Inquiry: The Economics of the UK Housing Market
Select Committee on Economic Affairs
Witnesses
Tuesday 22 March in Committee Room 1, Palace of Westminster

At 3.35pm

Mr Brandon Lewis MP, Minister of State for Housing and Planning, Communities and Local Government
Mr Damian Hinds MP, Exchequer Secretary, HM Treasury
Possible Questions
The Committee questions the witnesses on a range of policy issues including:

The Government’s aspiration for a million new homes by the end of the Parliament and how this figure was decided on
Why the Government is confident there will be a sharp increase in private sector house building
Whether the Government’s housing policy focus should move from demand side measures to helping to increase the supply of housing
What the Government can do to support the building of new homes on public land
How the Government can support local authorities ‘huge ambition’ to get involved in housebuilding again
Why the Government has such a clear preference for home ownership over other tenures?
The Chancellor announced in the Budget that Government will take measures to speed up the planning system. The Ministers will be asked for further details on how this will be achieved.”

http://www.parliament.uk/business/committees/committees-a-z/lords-select/economic-affairs-committee/news-parliament-2015/ministers-evidence-session/

All previous sessions (this is the last one) are available on the site with full transcripts

South-West house prices: 16 years for a single person to save for a deposit

“Overall the average UK price tag on a home has passed the £300,000 milestone for the first time, a report from a leading property website reveals. And a single person on average pay saving for a deposit for a house in the South West will need to be putting money aside for 16 years, while a couple would still take two years and three months to gather the down payment on a mortgage, according to research from Estate Agents Hamptons International.”

http://www.plymouthherald.co.uk/House-prices-South-West-hit-record-high-single/story-28961054-detail/story.html

Budget: “garden villages” will have at least 1,500 homes, “garden towns” at least 10,000

Good luck with those “gardens” folks!

In his Budget, Mr Osborne says: “The government supports the construction of a new wave of garden towns and cities across the country, with the potential to deliver more than 100,000 homes.

“The Budget announces that the government will legislate to make it easier for local authorities to work together to create new garden towns, as well as consult on a second wave of Compulsory Purchase Order reforms with the objective of making the process clearer, fairer and quicker.

“For areas that want to establish smaller settlements, the government will provide technical and financial support to areas that want to establish garden villages and market towns of between 1,500 to 10,000 homes.”

http://www.plymouthherald.co.uk/Budget-Chancellor-gives-ahead-new-Garden-Villages/story-28935784-detail/story.html

And just to be clear: “clearer, fairer and quicker” applies to developers, not us!

It’s private landlords that profit from housing benefit – not tenants

“[Dispatches] airing on Channel 4, investigates how private landlords are now the fastest growing provider of accommodation for housing benefit tenants, receiving £9 billion a year from public funds.

…the programme also reveals how private landlords now own 40 per cent of all former council houses, leading to fears of a shortage in social housing.

Dr Victoria Cooper, lecturer in Social Policy at the Open University, tells the programme: ‘Approximately 40 per cent of the housing benefit budget is spent on the private rented sector.

‘What we’re seeing is a redistribution of wealth and while public funds were previously spent within social housing and then used to reinvest to expand that social housing, this is no longer the case.

‘With the private rented sector the money isn’t redistributed and it simply goes into the pockets of private landlords.’

http://www.dailymail.co.uk/news/article-3490869/Landlords-making-1m-year-housing-benefits-Channel-4-s-Dispatches-shows-exploiting-hand-outs-forcing-tenants-live-dangerous-accommodation.html

“Town planning gives us the worst of all worlds”

Keith Rossiter in today’s Western Morning News:

“A walk through any Westcountry market town at 8am on a weekday ought to be enough to convince us that Matthew Taylor, the former Truro and St Austell MP, is talking sense.

Matthew, now Lord Taylor of Goss Moor, says our housing policy is sick – and those pointless traffic jams in what should be rights be quiet country towns are the most obvious symptoms.

The worst of the traffic congestion comes from the new housing estates that ring our historic towns like encircling armies.

You can’t blame the people who live in these estates – like all of us, they are just looking for an affordable place to live.

But their homes are not affordable – the policy of allowing only this suburban doughnut of development has driven up prices to the point that in some parts of the country a single building plot will set you back £500,000.

And their homes are not even desirable, whatever the developer’s adverts say. They are increasingly tiny – the smallest in Europe, bar flat-dwelling Italy and Romania. They must drive into town because they have no schools, shops or jobs, and usually their streets aren’t even leafy.

The developers may have promised such luxuries when they were granted outline planning consent but, oh dear, when push comes to bulldozer, it’s “just not viable”.

The councillors on the planning committees shrug: at least they have met their Government-set housing targets.

Each time one of these new estates goes up, there are scores of angry, unhappy people who have lost their views and their access to the countryside. Multiply that across the country, and it’s no wonder town planners have such a bad name.

Is anyone happy? The suddenly rich former landowner almost certainly, as he flies his shiny new helicopter to his shiny new villa in Bermuda.

In a convincing speech to an audience at Plymouth University last Thursday, Lord Taylor called for a new planning strategy in which rural councils are given the power to acquire farm land to build new Garden Villages of 1,500-5,000 homes, separate from existing communities.

Legislation to allow councils to pay above market rates for agricultural land but below that for development land would kill two birds with one stone. The farmer will be handsomely compensated, and the resulting profit will be ploughed back into the new community for schools, shops and other facilities.

But you’ll be concreting over our green and pleasant land! I hear you cry.

Not so, says Lord T. Today, just nine per cent of England is developed. Another million homes in Garden Villages would barely take that figure to 9.5 per cent.

Unlike the present system, which seems designed to create unhappiness, “a new Bodmin, off the A30 and over the hill, would be seen by hardly anyone,” he says. Being smallish, it won’t require new dual carriageways. And being at least partly self-contained, it can become a real community.

What’s not to like?”

http://www.plymouthherald.co.uk/Keith-Rossiter-Town-planning-gives-worst-worlds/story-28906598-detail/story.html

One company does at least 250 Housing estimates for local plans – councils refuse to disclose data

One botched arithmetical calculation could change housing figures all over the country – but councils refuse to allow scrutiny of the data.

“Councils have a public duty to estimate housing need. Guildford has delegated this calculation to a property consultancy called GL Hearn. It has not disclosed the detailed arithmetic and assumptions to show how the housing need for the borough was calculated. It even professes not to hold a copy of the model.

Guildford’s Code of Conduct pays lip-service to ‘Openness’, ‘Transparency’, and ‘Honesty’. Failure to oblige contractors and consultants to disclose their calculations to the public is not consistent with these values. Nor is it an acceptable method of conducting public affairs. It is not consistent with the principles of good public procurement contracting. Failure to explain in detail the assumptions and arithmetic behind the housing need estimates which underpin the Local Plan is a dereliction of public duty.

GL Hearn apparently subcontracted the work to Justin Gardner Consulting:

http://www.justingardnerconsulting.co.uk/index.php?page=test-page

It claims to have worked for some 250 planning authorities across England. Failure to disclose may therefore be widespread.

Please see the Information Commissioner’s decision on the link below:

Click to access fer_0558599.pdf

http://www.guildford-dragon.com/2015/11/07/letter-the-way-our-housing-numbers-have-been-calculated-should-be-revealed/”

https://www.change.org/p/mr-paul-spooner-leader-of-guildford-borough-council-councils-must-publicly-disclose-housing-need-calculations-in-guildford-and-across-england

East Devon District Council, Exeter City Council and Teignbridge recognised as developers’ friend

The three councils make up the “Greater Exeter” consortium and, along with other chosen council Mid-Devon, ensures a speeded-up planning process in a continuous ring centred on Exeter.

Half a dozen councils across Devon and Cornwall have been chosen to pilot a new Government scheme designed to speed up the creation of new homes.

Housing ministers have selected the six local authorities to take part in the trial launch of their brownfield register initiative.

Under the policy, councils will draw up lists of derelict land and other underused sites which could be used for new developments.

Records will then be available to investors and construction companies to highlight prime redevelopment opportunities. …

… Cornwall, East Devon, Exeter, Mid Devon, Torbay and Teignbridge council have all had their bids to pilot the scheme accepted. They will join 70 other local planning authorities in trialing the scheme, and helping to shape the future implementation of the policy.

Registers will eventually become mandatory for all councils under proposals going through Parliament in the Housing and Planning Bill. Other measures in the Bill will enable “permission in principle” to be granted for registered sites, giving developers “a greater degree of certainty” and ultimately speeding up the planning process. …”

http://www.plymouthherald.co.uk/Devon-Cornwall-councils-chosen-pilot-new-housing/story-28901908-detail/story.html

The keywords are “under-used” and “prime redevelopment opportunities”- who decides? EDDC, helped by developers, of course!

“Help to buy is riddled with loopholes that the privileged can easily exploit”

” … a loophole in the details of the government’s flagship starter homes scheme could be exploited by prospective buy-to-let landlords – there is currently no stipulation that the buyer must live in the property. So potentially, wealthy parents could hand a child a lump sum to purchase a starter home with a 20% discount, then let the property out.

Rather than a sustainable and measured solution to the housing crisis, the government has built a house of cards: a few haphazard measures designed to temporarily boost the number of first-time buyers, without examining the foundations of the problem, but also leaving each scheme open to exploitation. In London, the capital’s specialised help-to-buy scheme doesn’t even require applicants to be first-time buyers to be eligible – they just have to be moving house.

A better solution would be one that tackled booming house prices and low building rates instead of throwing state cash at the problem and hoping it solves it, rather than simply gilding the pockets of the private sector.”

http://gu.com/p/4hejm

“The Tories’ Housing Bill will wreak havoc in their own back yard”

“Today the House of Lords is trying to stop another Tory policy – counting Starter Homes which cost £450,000 as ‘affordable housing’.

But while there’s been a lot of noise about Labour-dominated inner-cities, campaigners say there are forgotten victims too – those who live in the countryside.

Shaun Spiers, chief executive of the Campaign to Protect Rural England (CPRE), writes why the Bill is hammering people in the Tories’ heartland.
The traditional idea of an English village may be one of rolling fields, thatched cottages and workers tending the land.

But just as important for our villages’ survival is a vibrant mix of people from all backgrounds.

The sad reality facing the countryside is that young people are moving out of their villages because they can’t afford a home.

Schools, shops and pubs are closing. And the Government, which last year promised to put the countryside at the heart of policy-making, is totally ignoring the housing plight of rural people on low or average wages.

With rural house prices much higher than urban prices and rural wages much lower, the only way to make villages affordable is to build more housing association or council homes for rent.”

http://www.mirror.co.uk/news/uk-news/tories-housing-bill-wreak-havoc-7488979

Shouldn’t all villages, towns and cities be heathy?

Owl could not bear to give vital oxygen to EDDC’s puff job about working with the NHS to make Cranbrook a “healthy town” which seemed to be closing the stable door after the healthy horse had bolted. It just seems an excuse for more committees reporting to more committees to keep themselves in expenses.

However, Owl IS happy to provide oxygen to this response:

Healthy towns alone won’t cure the ills of urban planning”
[Ten new towns are planned and one of these is Cranbrook]
Simon Jenkins, Guardian

“The strain of running the NHS is clearly getting to its boss, Simon Stevens. With daily headlines of woe perhaps it is understandable that he should have lost the plot. Stevens has given his imprimatur to the phoney “garden city” movement, by redubbing its estates “healthy towns” and offering to send in his apparatchiks.

Towns, designed to address problems such as obesity and dementia, will have 76,000 new homes and 170,000 residents.

Fantasy answers to the ills of modern life are as old as Thomas More’s Utopia. England’s first official garden city, Letchworth, was born in 1903 as the result of a book – always a bad sign. It was Ebenezer Howard’s To-Morrow: A Peaceful Path to Real Reform. Its slogan, “health and efficiency” was adopted by early nudist magazines.

Letchworth was wonderfully bonkers. It was a “cottagey” settlement of teetotalism, co-education, poetry evenings, book-binding, embroidery and sandal-making. The nonalcoholic pub, The Skittles, served Cydrax, Bovril and adult education. It was advertised as “a meeting place for striking workers”. It sounds just the place for today’s junior doctors.

Adding the word healthy to a property may help sales – as in the Vale of Health in Hampstead – but no one can control who lives in these places over time. Letchworth’s builder, Raymond Unwin, soon escaped to Hampstead and the residents cried out for booze, and got it. Like their contemporaries they sprawled over rural Hertfordshire, heavily dependent on cars.

Stevens has updated the spirit of Letchworth to hipster digital. His garden towns will be run by “Wi-Fi carers”, Skyping GPs and an internet of things. There will be “dementia-friendly” streets, fast-food-free zones, and a “designed-out obesogenic environment”.

This sounds like a brave new world.

Today the phrase garden city has become a euphemism for building in the green belt. It is laundered planning. The most recent such city, Milton Keynes, is shockingly wasteful of land and infrastructure. One of Stevens’ 10 proposed sites is our old friend George Osborne’s Ebbsfleet. It is a not a garden city but a 10-year-old failed housing estate in north Kent. People do not want to live there – even in flats priced at £150,000.

The idea that any of this has to do with the so-called housing crisis is absurd. Stevens’ new towns are mostly development sites where builders can gain the highest profit: on green land round London, Oxford and Cambridge, and in Hampshire and Cheshire. Since the developers will have to pay for them up front, they will be calling the tunes. We know the result: more sprawl.

Housing policy at present is driven by one interest group alone, the out-of-town speculative house-builders. They are in the business of new build, and have brilliantly engineered themselves one Osborne house-buying subsidy after another.

New build comprises barely 10% of property transactions, less in cities. There is no evidence that house prices reflect the rate of new building. They chiefly reflect the cost of money, which in Britain has never been cheaper. That is why prices continue to rise, despite the hysteria.
London’s biggest housing handicap is simple. It has one of the lowest housing densities of any big world city, a quarter that of Paris. This density is what conceals London’s true housing reserve, its empty rooms, empty flats, vacancies above shops, wasted airspace above low-rise dwellings. It is what imposes a near intolerable burden on commuter transport, which out-of-town housing will exacerbate.

The job of policy should be to encourage surplus space on to the market. Yet at present every single housing policy works in the opposite direction.
Density should be encouraged by increasing council tax, not suppressing it. Downsizing should be encouraged by lowering stamp duty, not raising it. Planning should encourage extra floors on low-rise houses.

Ever more Londoners are renting not buying, as in Berlin. Yet buy-to-let – which should be encouraged, to drive down rents – is penalised, and will thus drive them up.

As housing charity Shelter turns 50, the country is still plagued by overcrowding, rogue landlords, insecure tenancies and homelessness. How do we even begin to make things better?

It is modern cities, not Stevens’ countryside, that are truly green, efficient, potentially healthy places. He should read the American environmentalist Ed Glaeser, who points out that the greenest Americans live in Manhattan. They walk a lot, share energy and live in easy reach of jobs, shops and services. “Those who move out to leafy, low-density suburbs,” he says, “leave a significantly deeper carbon footprint than Americans who live cheek by jowl.”

The NHS should campaign to make the city healthy, not a few privileged out-of-towners. Stevens should demand a slash in urban pollution. He should plant trees, build proper streets where walking and shopping are safe and children can play, instead of today’s lumpy, glass-bound boxes. He should read Jane Jacobs on “defensible space”, on what makes modern cities livable (streets), and what kills them (estates).

The government’s role in housing should be to remove obstacles to the market for everyone, but to spend money only on the genuinely poor. The obsession with “affordable housing” – a new house at 80% of market price – may please Tory voters but it merely drives up house prices. Public money should go to those in need of hostels and special units, of which London is chronically short.”

http://www.theguardian.com/commentisfree/2016/mar/02/healthy-towns-wellness-communities-urban-planning

Council bungalows under threat?

It all seems to depend in how different council value their properties. And when you have an “asset sweating” council like EDDC, with its excellent relationship with developers, Owl thinks we all know the answer to that one …

Older and disabled people could be disproportionately affected by plans to force councils in England to sell high-value social housing, campaigners say.

The Joseph Rowntree Foundation said the policy was likely to lead to a widespread sell-off of bungalows, which are often popular among the elderly.
It said 15,300 council-owned bungalows in England could be sold off by 2021.
But ministers say councils can decide not to sell a property if it meets “a particular need” or is hard to replace.

The Housing and Planning Bill – which the government says will help more people become home owners – goes before the House of Lords later.
If it is passed, local authorities will be compelled to sell expensive properties as they become vacant, to “ensure that the money locked up in high value vacant housing stock will be reinvested in building new homes”.
According to the Bill, what will count as a “high value” property is likely to vary in different areas. …

… In the [Joseph Rowntree ] foundation’s report, researchers from Cambridge University said they found high demand for bungalows meant they were almost three times more likely to be sold off and would be harder to replace because of the amount of land needed.

It also estimated that while bungalows make up 9% of council-owned housing, they were likely to make up 25% of high-value property sales because of their higher cost and more frequent vacancies – a result of people moving into residential care or tenants moving later in life.

One in five older people currently lives in a bungalow, a proportion that increases steadily from 55-75, according to the report. This figure rises to one in four when there is someone sick or disabled in an older person’s household.

Brian Robson, from the Joseph Rowntree Foundation, said the housing Bill would reduce the number of affordable homes at a time of an “acute housing crisis”.

“We risk holding a great British bungalow sell-off that will make things worse for older and disabled tenants who are trying to find suitable, affordable accommodation,” he said.

“The increasing reliance on costly, insecure tenancies in the private-rented sector to house families on low incomes will only serve to trap more people in poverty. …”

http://www.bbc.co.uk/news/uk-35712980

“Developers accused of restricting supply of new homes to boost profits”

“Britain’s developers have been accused of increasing their profits from the UK’s housing crisis by restricting the supply of new houses to keep prices artificially high.

Latest figures reveal that nearly half a million homes in England now have planning permission granted but have yet to be built. The length of time it takes for developers to complete a house has jumped from 24 months to 32.
It reignites a long-running row between policymakers and the housebuilding sector over who is to blame for the current housing shortage.

While rates of planning permission for new homes have increased by 60% since 2010, there has been a 48% increase in the number of new homes being built.

Labour MP Clive Betts, chair of the local government select committee, said the failure of the big housebuilders to speed up development was simply designed to maximise their profits.

“I think it is clear that the big developers are building at a rate to maximise their profits rather than addressing the country’s housing need,” he said.

Betts said that some developments that have had planning permission were not due to be completed for another 10 years.

He added: “These are private companies who are very simply trying to make money for their shareholders. They are restricting supply and the government urgently needs to come forward with measures to address this.”

Ministers are increasingly concerned by the failure of developers to speed up housebuilding. It has been reported that some senior Conservatives privately believe that some developers are deliberately restricting the supply of new houses to boost profits.

Brandon Lewis, the housing minister, last week gave vent to his own frustrations with developers.

“When you have got housebuilders delivering, on average, 48 homes a year on some [large] sites that’s not good enough,” he told the local government committee.

“We know they can go further. Housebuilders will talk about saturating the market. But we are aware that in too many places we are still taking 20 weeks to build a house when we can do it in three or four.”

Taylor Wimpey recently announced a record operating profit margin of more than 20% as it sold more homes at higher prices. Pre-tax profits at Barratt Homes, Britain’s biggest housebuilder, have also jumped 40% in the last six months to nearly £300m.

Housebuilders reject claims of hoarding land as property prices soar
Ministers are understood to be contemplating new measures to force up the rate of development amid fears that they will fall short of their manifesto commitment to build 1m new homes by 2020.

This could include forcing developers that buy publicly owned land to commit to rapid construction as part of the planning process.

The housing industry analyst Glenigan compiled the latest data for the Local Government Association, which was released in January.

It showed that 475,647 homes in England which have been given planning permission were yet to be built in 2014/2015.

In 2012/13, the total of unimplemented planning permissions was 381,390 and in 2013/14 it was 443,265.

A spokesman for the Home Builders Federation, which represents the industry, said the most recent government figures show there were 170,690 net additions to the housing stock during 2014/15, an increase of almost 25% on the previous year.

“The industry has delivered unprecedented increases in supply over the past two years driven predominantly by the large private sector housebuilders,” he said.

“This has been on the back of the pro development policies introduced in recent years and a general increase in demand.”

He blamed the planning systems of local and central government for the shortfall in housing.

“As a priority, it needs to work with local authorities to speed up the planning system and ensure local plans allocate enough sites of different types and sizes that are attractive to a range of companies,” he said.”

http://gu.com/p/4h7f9

First time buyers lottery: 141,000 to win up to £200,000 – nothing at all to 2 million

“The government’s starter homes initiative could deliver a taxpayer-backed windfall of £141,000 each to 200,000 lucky first-time buyers, but 2 million more aspiring homeowners will be stuck renting, campaigners say.

The scheme, which allows developers to replace shared ownership and affordable rented homes with properties sold at a 20% discount, has been widely criticised since it was first announced in December 2014. One of the key concerns for housing campaigners is that the homes can be sold on at the open-market rate after five years.

Lobby group Generation Rent said that this meant a “£27bn raffle” in which the original buyers stood to gain, while those who missed out would find it ever harder to get on the housing ladder. It said the scheme’s potential rewards “far exceed the already generous returns of home ownership”.

The figures are based on average newbuild house prices and numbers of new homes being built around the country. The average cost of a newbuild property in England stands at £297,000, according to the Office for National Statistics. So as a starter home it would be bought at £238,000, Generation Rent said. If house prices rise at 5% a year, after five years the same property could be sold for £379,000. Outside London, the maximum cost of a qualifying home is £250,000 but in the capital that rises to £450,000. Generation Rent said buyers could stand to make a profit of £228,139 on a home bought for £383,200.

The group is calling for the homes to be subject to rules saying that they can only be sold on at a 20% discount. Betsy Dillner, the director of Generation Rent, said this would help multiple first-time buyers “instead of a jammy handful of winners in a multibillion pound raffle”.

She added: “The government said its starter homes would be exclusively for first-time buyers, but by letting them vanish into the open market after five years, they’re betraying the millions who are stuck renting.”

The housing charity Shelter last year described the properties as “non-starter homes”, saying that by 2020 in more than half of the country they would be unaffordable for families earning average wages.

Shelter’s chief executive, Campbell Robb, said: “While the government is offering these discounted homes to a select few, for those who aren’t so lucky, all they’re offering is more time spent in expensive and unstable private renting, or living with mum and dad well into their 30s.

“This crisis can be turned around, but only if the government moves beyond schemes that only help the well off, and starts investing in homes that ordinary families can actually afford as well.”

As the House of Lords prepare to debate the policy as part of the housing bill this week, experts said there were many unanswered questions surrounding the policy. Neal Hudson, an associate director at property firm Savills, said that despite the scheme being a key plank of government housing policy “there is still a massive amount of detail outstanding on how it will work”.

He added: “There is likely to be a lot of uncertainty about how much people should be paying for land because they are not sure how they will be able to use it.”

Hudson said uncertainty remained over how the prices of starter homes would be determined if there were no comparable properties nearby, and how mortgage lenders would treat a property that could not be sold at market rate for five years.

Other analysts have questioned how the policy will run alongside the government’s help-to-buy loan scheme, where buyers are offered a 20% interest-free loan but must repay it when they sell.

In January the head of housebuilder Taylor Wimpey said that confusion over how the scheme would work was causing problems for developers. Pete Redfern said: “It’s quite hard if you’re looking at a future site to know how that policy balance will end up, because local authorities feel more threatened by starter homes than by anything else.”

Research carried out by Savills for the Local Government Association (LGA) found that the discounted starter home prices were out of reach for all people in need of affordable housing in 220 council areas and for more than 90% in a further 80 council areas.”

http://gu.com/p/4h4pe

“Planning policy discourages larger homes says housebuilder”

Forgive Owl being cynical but larger homes sell for more money and make more profit for the builder! And why does “empty nesting” need larger homes?

“One of the UK’s biggest housebuilders has hit out at government planning policy as new figures emerged showing a steady decline in the number of larger family homes being built.

The number of homes constructed with four bedrooms or more halved between 2001 and 2011, from around 50,000 to 25,000, research carried out by law firm Nathaniel Lichfield & Partners and Cala Homes found.

Since 1991, only 28pc of new homes built have had four bedrooms or more, which Cala blamed on rules that require developers to build a minimum of 30 dwellings per hectare, favouring smaller homes.

The housebuilder warned that with the rise of the UK’s middle classes and a growing trend among the nation’s ageing population for “empty nesting”, more home owners are now demanding larger houses. It claimed more than 700,000 households in England are overcrowded.

Price inflation for large detached family homes has significantly outpaced that of other housing types over the last 20 years, further putting the squeeze on families looking to move up the housing ladder.

Recent government policy has focused on boosting housing supply for first time buyers through new initiatives such as the Help to Buy scheme, which provides mortgage guarantees and equity, and Starter Homes.

Cala wants the Government to review housing policy to give large home development at least equal weighting to that of smaller homes – saying it is currently too biased towards first time buyers. It also criticised the Government’s strategy to encourage older or single people to downsize, saying the policy will never contribute sufficient numbers of homes to affect housing supply.

Alan Brown, chief executive of Cala, said the policies failed to meet “the real demands of growing families across the country”.”

http://www.telegraph.co.uk/business/2016/02/27/planning-policy-discourages-larger-homes-says-housebuilder/

Money to demolish “sink estates” is really loans to developers!


David Cameron’s promise to spend millions on bulldozing and rebuilding sink estates as a key part of his prime ministerial legacy appeared to unravel last night as it emerged that the small amount of money set aside for the project can only be accessed by private developers in the form of loans.
To great fanfare, the prime minister announced his intention in January to potentially tear down 100 of the UK’s worst estates to tackle drug abuse and gang culture. The modest size of the £140m “fund” set aside by Cameron to meet costs was widely questioned at the time, but Downing Street insisted that the redevelopment programme would reverse decades of neglect.

The housing developments being targeted reportedly include the Winstanley estate in Wandsworth, south London, the Lower Falinge estate in Rochdale, Greater Manchester, and Broadwater Farm in Tottenham, north London.

Now the Observer has learned that the £140m is only available in loan form to private sector organisations who come forward to regenerate stricken areas. A statement quietly released by the Department for Communities and Local Governmentin February admitted: “£140m of loan funding has been set aside by government, to be used as a springboard for partnership and joint venture arrangements, with the active involvement of communities.”

A spokesman said the rate of interest on the loans to private companies would vary “scheme by scheme”. The application process, more than a month since the announcement, has yet to be opened to interested parties.

The revelation will be an embarrassment for the prime minister, who claimed on the BBC’s Andrew Marr Show at the time that “in the worst estates … you’re confronted by concrete slabs dropped from on high, brutal high-rise towers and dark alleyways that are a gift to criminals and drug dealers”.
Promising to transform the worst estates, Cameron added: “For some, this will mean knocking them down and starting again. For others, it might mean changes to layout, upgrading facilities and improving road and transport links.”

His announcement on the regeneration of sink estates was widely seen as an attempt to claim the centre ground as Jeremy Corbyn’s Labour party moved to the left. The redevelopment programme is to be overseen by Michael Heseltine, who helped to transform the Liverpool and London docks in the 1980s. However, in the light of revelation about the reality of the funding, John Healey MP, the shadow secretary of state for housing and planning, accused the prime minister of making “hollow announcements to make headlines”.

He said: “After five years of Tory failure on housing, those living on estates around the country need investment in new homes and estate regeneration – not an announcement of a new fund that is quietly downgraded when it is hoped no one will notice.”

A DCLG spokesman said the loan status of money set aside for regeneration had been laid out in the autumn statement, ahead of Cameron’s claim in a Sunday newspaper and on the BBC to have put aside a “fund” for the initiative.He said: “We’re determined to kick-start the regeneration of council estates to provide high quality homes to benefit thousands of people.

“The autumn statement made absolutely clear that the government is providing loan funding for council estate regeneration projects. “The £140m will be used to lever in additional funding from local authorities, housing associations and private investment. High up-front costs and long timescales for development mean regeneration schemes can become stalled because upfront finance is unavailable. These low-risk loans will help remove blockages and speed up processes to transform estates.”

http://www.theguardian.com/society/2016/feb/27/david-cameron-sink-estates-fund-turns-out-to-be-loan