Housing White Paper: The key proposals

The Government has today unveiled its plans  to fix the 'broken' housing market and increase the delivery of new homes across the country.  A full copy of the White Paper can be downloaded here.

Communities secretary, Sajid Javid, told the Commons  that the current system isn’t working and that it is one of the greatest barriers hindering progress in Britain today. Javid said that the white paper is "A bold, radical vision for housing in this country", but is it enough to solve the housing crisis?  

A short summary and analysis of the key points can be found below:

Step 1:  Planning the right homes in the right places
Councils and developers will be expected to use land more efficiently by not building homes at low density and building higher where there is a shortage of land.

40% of local planning authorities do not have an up to date plan that meets the projected growth in households in their area. Consultation will begin to establish a new, standardised way to calculate housing demand. Every local area will need to produce a realistic plan and review it at least every five years.

The government has reaffirmed its commitment to the green belt. Only in exceptional circumstances may councils alter green belt boundaries after consultation of local people and submitting the revised Local Plan for examination.

Action will also be taken to radically increase brownfield development and to bring life back to abandoned sites.

Step 2:  Building homes faster
Local authorities will be given tools to help speed up house building and additional powers to make sure that all developers build homes on time.  

The Government is to consider amending national planning policy to encourage local authorities to shorten the timescales for developers to implement a permission for housing development from the default period of three years to two years.

Whilst support will be given to developers to help them build out new homes quickly, they will need to provide greater transparency on their pace of delivery so that councils can take this into account when planning the local need/demand.

The Government will also examine options for reforming the system of developer contributions and the licensing system for managing great crested newts. 

Local planning authorities will be encouraged to use their compulsory purchase powers to support the build out of stalled sites.

Step 3:  Diversifying the market
The Government want to diversify the market to achieve the amount, quality and choice of housing that people want. This includes supporting new and different providers, more innovation in methods of construction, and supporting new investors into residential development.

Support will be given to smaller house builders to create more competition and innovations. The £3 billion Home Building Fund will provide £1 billion of short term loan finance targeted at SMEs, custom- builders and innovators to help deliver up to 25,000 homes this Parliament. 

An accelerated construction programme will increase the number of participants in house-building and help change the wider housing market.  

Public land will be made available to build on quicker.  Sites will be tendered individually or as part of a portfolio of sites to spread risk, provide confidence to invest and obtain best value for the tax payer. The government will undertake some of the costs, where appropriate, to remediate work to reduce development risk.

The Government will promote the National Custom and Self-build Association portal for right to build, ensuring that the exemption from the community infrastructure levy for self-build remains in place. They will offer tailored support packages to councils who want to build on their own land at pace, through the Accelerated Construction Programme.

Work will be undertaken alongside local authorities to understand all the options for increasing the supply of affordable housing, as well as working with authorities in high demand areas, which have a genuine ambition to build.

The Affordable Homes Programme for 2016-21 was launched last year and new funding and greater flexibility has been announced so that it now funds a range of affordable homes for rent as well as home ownership.

Support will be provided to housing associations, and in due course, a rent policy for social housing for the period beyond 2020 will be set out enabling them to borrow against future income.

Step 4:  Helping people now
From April 2017 a new Lifetime ISA will be introduced offering a 25% bonus on up to £4,000 savings that can be put towards the purchase of a first home.

Help to Buy programme extended for an extra year to 2012 with a commitment of £8.6 Billion with Government saying they are committed to working with sector to determine the future of the scheme after this.

Starter Homes must be purchased with a mortgage in a bid to prevent abuse by cash buyers and there will be a 15 year repayment period.  When the property is sold this means that some or all of the discount is recovered.

Amendments will be made to the NPPF to include clear policy that housing sites deliver a minimum of 10% affordable housing units.

More brownfield sites will be released for developments with a higher proportion of starter homes, supported by a £1.2 billion Starter Home Land Fund.

Right to buy is to be extended to housing association properties.

MPC will be providing further analysis over the next few days but if you require any further information please contact us on 0203 735 9644.