Planning juries may be a stupid idea, but updating council tax, resourcing councils better and stabilising land costs are things everyone has been demanding for years.
In just over two weeks, the unwashed masses at Glastonbury will once again commune in Somerset to celebrate the solstice, sink a load of cider (among other things) and maybe catch a few tunes. The likelihood of a Jeremy Corbyn sing-along is probably higher than a mud-free weekend. Yet the irony of well-heeled revelers – many paying hundreds of pounds per ticket – denouncing the evil capitalism at a festival hosted by a millionaire with major record label stars appears to have been lost on most people.
This is relevant because one of the proposals in Labour’s ‘Land for the Many’ report, involves granting access “across all uncultivated land and waterways, excluding gardens”. So if you don’t have a Glasto ticket, maybe you won’t need one.
Back in the real world, the political circus erupting today has been entirely predictable. Labour proposes some kind of reform to end all our inequality and the Tories respond over-dramatically claiming the sky (and the housing market) will collapse. The truth, as ever, is somewhere in between.
Some of the objectives here are laudable: encouraging more efficient use of housing by taxing under-occupation; building more affordable housing; stifling the skyrocketing cost of land; and improving life for renters are some of those ambitions.
Some of the assertions made also chime with what developers have been saying for a decade. “Planning authorities have been hit even harder by austerity than other public bodies,” the report says. This is spot on. Planning authorities need more funding. There is also “an unhealthy reliance on developer contributions [to pay for] affordable housing”.
The problem here is that some of the solutions posed to these problems don’t make total sense and ignore some of the other key drivers or considerations (such as employment or the need to support universities).
Labour’s proposal for planning juries is an admirable attempt to tackle NIMBYism head on but risks injecting more uncertainty into the planning system, which is partly why residential land values are so high in the first place: it is often a costly and difficult process to get planning permission.
The UK is already unusual in treating planning applications effectively on a case by case basis rather than under a rules-based system as many European countries do.
Meanwhile, targeting foreign investment in housing will simply make London uncompetitive and send high-value employers and students abroad to competing countries and cities. The unaffordable cost of land, for instance, won’t be remedied by improving compulsory purchase order (CPO) laws, as welcome as that may be.
Subsidised home loans via Help to Buy and cheap mortgages have sucked up the price of land by driving up demand. Inconsistent planning rules that leave everything open for debate, interpretation and local political whim do the same.
According to Labour’s paper, the solution for almost everything is a bigger local authority presence. More resources for some things makes perfect sense, but does the public really want their local councils to be property developers? Probably not.More worrying is the exclusion of any mention of housing associations. The suggestion that councils will somehow be able to do everything is rather ridiculous, not least with the experience HAs possess across development, management and the wider support of communities.
Locally-set housing targets
Labour says that “local authorities should be required to set housing targets based on identified local housing needs, rather than simply responding to national targets based on demand.” This makes little sense. There is a difference between “need” and “demand” of course, but ultimately, housing – like any kind of infrastructure – cannot simply be viewed within the walled garden of a local authority. Doing so allows local politics – and specifically the politics of nimbyism – to thrive. And the inability of councils to align with neighbouring authorities routinely sees development falter when crossing council borders.
Housing targets need to be considered strategically on both a national and regional basis. They need to link to employment growth, skills and soft infrastructure and be considered alongside major development, such as Crossrail 2 or HS2, which can create immense value for adjoining land by making it more connected over night.
Of course, there should be local engagement, but there is always a disincentive for locals to support any kind of development. Pretending this isn’t true helps nobody. We to take politics out of housing, not put more of it in.
There is a clear need to cut down the 200,000 odd empty homes we have across the country. But erecting a wall to foreign investment is incredibly short-sighted, particularly as we stare down the barrel of Brexit. In London particularly, foreign investors make a disproportionate contribution to universities. They create jobs and wealth, and support all sectors, from healthcare to retail, that the city depends upon. While Labour seems focused on targeting the super-rich, we severely risk undermining our values of being open to all. London, like Manchester and Birmingham, have thrived off of their multicultural growth.
Where do we draw the line on stopping foreign ownership? Does this mean we pull up the drawbridge for the foreign doctors, nurses and support workers who underpin the NHS?
Fixing the rental market
Plans to restrict buy-to-let lending and make tenancies fairer will be welcomed by most people.
However, the wider risk here is in setting anti-foreign investment policy that scares off institutional investors who are needed, especially in our cities, to drive investment in rented housing, social housing, and retirement communities. We’ve seen previous tax changes have a multitude of unforeseen consequences.
More than £90 billion of institutional capital could be targeted at build-to-rent, with billions more focused on other tenures. The best way to improve standards for renters is to build market quality homes, en masse, that offer higher standards for renters with the certainty and consistency they don’t currently receive.
One of the more contentious suggestions is around stopping what Labour describes as “council tax discounts” for second home-owners of “single people occupying large homes”. As with the Tories infamous plans to reform social care (AKA the dementia tax) this is a thorny issue that will always be subject to deliberate misinterpretation by tabloid headline writers. But it needs to be sorted.
It’s right to look at how we limit under-occupation of housing. But as with many of the other suggestions here, no single policy on its own will help. Council tax reform is long overdue. But so is a reform of stamp duty. Cutting stamp duty for downsizers would have the same benefit of encouraging people to move, freeing up properties for second-time buyers and those with families.
Since Glastonbury began 50 years ago, house prices have risen by 166 percent (513 percent in London). Many of its original revelers will have made more than a mint through housing which seems to constantly be at the centre of so many policy debates around tax, social care and increasingly, health and wellbeing. There are some sensible suggestions here, but as much as anyone would like, there’s no magic pill we can drop to make the problems disappear.