HOUSING: Developers told to build or risk losing plots
DEVELOPERS who drag their feet on house building could be forced to release unused plots, Philip Hammond warned yesterday.
The Chancellor said the state ‘will intervene’ in cases where firms are hoarding sites without good reason. He will also announce measures in this week’s Budget designed to increase the number of homes built each year to 300,000 – a rise of almost 40 per cent.
The proposals will include an inquiry into socalled ‘land banking’ by developers, who are accused of dragging their feet in order to maximise their profits. Housing charity Shelter estimates that the ten biggest developers are sitting on more than 400,000 plots that have planning permission for housing.
Mr Hammond yesterday said the Government estimates there are 270,000 unused plots in the London area alone. In some cases, he said officials might try to help developers by paying for new roads or other infrastructure or by offering grants to clean up contaminated land.
But the Chancellor also warned that developers could face direct intervention, including compulsory purchase, unless they act to accelerate house building. He told the BBC’s Andrew Marr show: ‘We need to understand why these planning permissions that are going up all over the country, that will continue to increase across the country, why they are not being built up.
‘We will intervene to make sure that they are. We will use money, we’ll use the powers of the state, we’ll use the powers of the planning system, but we are determined to get those missing homes built.’
Mr Hammond has come under pressure from Theresa May and Communities Secretary Sajid Javid to release cash to tackle the housing crisis. Mr Javid is seeking £50billion to fund a massive housebuilding programme. But the package on Wednesday is likely to be much more modest.
Mr Hammond yesterday said: ‘If you pour money in without fixing the other elements of supply, you will simply create more house price inflation. That makes the problem worse, not better.’