Local authorities will receive more powers to pressure developers into building on land they own, the communities and local government secretary Sajid Javid said.
“This means being able to borrow to invest in housing and to keep 100% of the receipts from properties sold through Right to Buy to replace homes and reinvest in building more of the genuine affordable homes our communities desperately need”.
Each year, around 250,000 new homes are needed according to government estimation. The government is no longer falling back on the old Tory adage that the “market will sort itself out”, they acknowledge that the market is broken.
At the heart are fresh moves to speed up planning and loan funding for smaller house builders.
For Labour, shadow housing secretary John Healey said the white paper plans were “disappointing” at a time when affordable housebuilding had fallen to its lowest level in 24 years. As the Resolution Foundation has shown, increasing proportions of income are being spent on housing costs, indicating an intensifying affordability crunch.
Nick Leeming, Jackson-Stops & Staff Chairman, said: “Today the government has thrown in the towel on Britain as a nation of home owners”.
The Structural Timber Association (STA) has welcomed the plans, saying the government’s commitment was acting as a catalyst for change in the wider housing market, through supporting offsite manufacturing techniques. As well as this, councils are being encouraged to get more involved. “This [paper] will not entail recklessly ripping up our countryside”, he said, adding that not a single restriction on greenbelt building will be lifted.
Russell Gardner, head of real estate at EY, said: “Despite raised hopes of truly radical reform, today’s white paper represents a timid response to a universally recognised housing crisis”. “It’s hard to see how these measures will enable the government to meet its target of 1 million new homes by 2020”. But some felt at the time that there was a worrying lack of detail.
The white paper also confirmed that the controversial ban on letting agent fees announced in last year’s Autumn Statement would also be introduced.
Councils, meanwhile. will need to produce a realistic housing plan and review it at least every five years.
In other measures created to crackdown on “landbanking”, the Government has reduced the time allowed between planning permission being granted and the start of building from three to two years. Now permission lapses after three years.
Planning rules will be amended so that councils can proactively plan for more long term Build to Rent homes and a consultation has been launched to allow developers to offer more affordable homes to rent alongside other forms of affordable housing. The institutional investors building homes for rent are already keen to encourage long term tenants, and it will typically be the better-off who can afford to rent them.
Mr Javid highlighted the problems in the current market, telling BBC Radio 4: “Walk down your local high street today and there’s one sight you’re nearly certain to see”.
Javid also said he wanted to open up the house-building market.
The Government’s decision to continue to prevent development on the green belt has also been criticised. Instead, he argued, the focus should be on brownfield sites and increased housing density.
As part of the proposals, the Government will make it easier for councils to issue completion notices, shortening the timescales to require developers to start building within 2 years, not 3, when planning permission is granted. A source in the department added that identifying housing requirements was particularly complex, but councils would be consulted on a new approach.