HOUSING POLITICS


lot of money to find in cash.” Grenville Turner, CEO of Countrywide,


suggests SDLT should only be imposed on the excess of the property price over £250,000. He also suggests proceeds should be ring-fenced to finance housebuilding and extend mortgage indemnity schemes to the resale sector. The Budget also saw one move that


surprised many observers with its non- dom orientated version of a mansion tax, higher stamp duty for properties over £2 million bought through a company, to prevent foreign owners taking their properties out of the tax regime. That might defuse price rises at the top


of the London market, but whether it will do very much more modest properties is doubtful.


sector, yet many observers believe the PRS is no longer fit for purpose. Matt Griffith says “disappointingly the government has kicked into touch reforms in the private rented sector which is becoming increasingly important”, and which could make it more attractive for institutions to enter the market, as well as making life better for tenants. Jennet says CBRE was hoping for


measures to support the growth of the private rented sector. “Much more is required to overcome the under- development of professionally managed, custom-built rented housing. The private rented market has nearly doubled in size in the last two years, as new households are forced to rent rather than buy, while owner occupation and public housing have remained static, yet the government has failed to grasp the opportunity for change. Rents have shot up, and landlords are


Could we make investment in mortgage assets more attractive


to institutions?’ PAUL SMEE CML


SCORES ON THE DOORS So, the scorecard seems to stand at a muddled five out of ten, trying, but not hard enough. Tracy says whatever government strategy is, “it’s certainly not radical”. She sees government schemes such as NewBuy as “good PR”, but believes more needs to be done. Matt Griffith, too, is unimpressed.


He says he can see “quite a lot of micro tinkering, but unlike the Labour government it’s focused on supporting the private sector.” Very little of what the government is doing is original, and most of it appears to be aimed at propping up the housebuilding sector rather than helping homebuyers or renters. A major gap in the housing strategy is


any sort of change to the private rented 10 MAY 2012 PROPERTYdrum


taking every advantage of a buoyant rental market. Tracy says bad landlords, bad properties, and bad treatment of tenants are “a dangerous time bomb” now that serious professionals and young families, not the standard rental demographic, are forced to rent. Families with children, for instance, need better security of tenure to ensure their children don’t have to change school every six months. She suggests 5-10 year lease terms that would give tenants more security, while making the sector more attractive to institutional landlords who need long term recurring income.


WHY ARE WE STUCK? So why hasn’t the government taken the bull by the horns? One reason may be that the ministry is marginal. Matt Griffith points out that housing ministers are only second tier ministers, and the Department for Communities and Local Government is not a powerful ministry, so it is difficult for any housing minister to stick his neck out and go up against the Treasury for fear of being sat on by George Osborne. (“Being sat on by Eric Pickles is not a good experience, either,” Matt comments wryly.) Another reason is that the government


finds itself trying to achieve mutually incompatible objectives. Tracy observes that you can’t get lower house prices for first time buyers and increase house prices for existing owners at the same time. Classical economic theory suggests that it’s also impossible to increase the supply of housing without seeing prices fall, one reason that a policy focused on major publicly funded housebuilding projects


Planning changes mean we may end up with only the top end of the market


being catered for.’ CAMPBELL ROBB SHELTER


would prove unpopular with older, propertied voters. She’s also intrigued by the thought of how localism can combine with increased housebuilding. “How does that work?” she asks. “They’re diametrically opposed!” She suspects that these policies have not been completely thought through. She’s not the only one. Roger Hepher,


head of planning and regeneration at Savills, says that “reconciling economic growth with localism was never going to be an easy call.” He notes that decisions have gone against developers in several high profile cases, so the government is sending mixed messages, we want you to build houses, but not if it upsets anybody. And Matt Griffith comes up with a third


reason for the government’s relatively lame response. Although, he says, many young advisers in Whitehall see the unaffordability of property as a personal problem, because they’re priced out of the market, the people who generally lose out as a result of insufficient housing are “dispersed, not particularly powerful, not politically engaged.” They certainly have little power within the Tory party, nor do they have as loud a voice as housebuilders, estate agents, and mortgage lenders. We won’t know whether this strategy,


or, more accurately, this collection of initiatives, has worked for at least 12-18 months. But if by then the housing start figures are still in the doldrums, it will be obvious that it hasn’t worked, and an awful lot will have been spent not getting it working.


Do you have any views to share? www.propertydrum.com/articles/coalition


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64  |  Page 65  |  Page 66  |  Page 67  |  Page 68  |  Page 69  |  Page 70