Saturday, 4 February 2017

Land bankers' myths gradually starting to unravel.

From The Daily Telegraph:

Developers will be ordered to use planning permission or lose it under government plans to speed up the building of hundreds of thousands of new homes. Ministers will next week publish proposals encouraging developers to build on plots more quickly rather than sit on land which has already been earmarked for new properties…

The news comes as it has emerged that the number of empty homes in the UK is at its highest level for 20 years, calling into question whether the countryside needs to be concreted over for new developments. The "housing surplus" has nearly doubled from 800,000 empty homes in 1996 to 1.4 million homes at any one time in 2014. These “empty homes” are typically second homes, or vacant properties which are either left empty or are awaiting for tenants or home owners to move in…

Currently builders lose planning permissions after three years unless work has started. However, they can maintain planning permissions on sites simply by “digging a trench”, sources said. This means that more than 700,000 homes which have been granted planning permission since 2006 are yet to be built. Under the new plans permission would be linked to the completion of homes by certain dates, rather than the starting of work…

A report last year by Civitas, a think-tank, disclosed how developers and landowners used a controversial relaxation of planning rules in 2012 to hoard planning permits rather than build more homes. More than two million planning permits were issued between 2006 and 2015 – a rate which would be enough to build an average of 204,000 new homes a year but foundations were only laid on 1.3 million of them.

Daniel Bentley, editorial director at Civitas, said councils had approved more than 200,000 homes a year for the past four years, and yet last year there were still only 164,000 new-build completions.

He said: “This would be a really bold step by ministers and suggests they are not prepared to tiptoe around developers anymore - for too long planning permissions have been granted with no obligation to build. This has meant that landowners and developers have been able to secure huge windfalls and then maximise their profits still further by drip-feeding new homes into the market at the highest prices they can.”

They're still making the following flawed assumptions:

1. That nudging up new supply (relative to existing housing stock) from half a percent to three quarters of a percent will make the blindest difference to rents and house prices. Even if it did, it would do nothing to reduce inequality, it would merely shift the gains from one favoured group to another at the expense of the same people (i.e. younger people).

2. That The Hallowed Green Belt must be preserved at all costs. Just look at the picture and caption at the start of the article! You wouldn't even notice 57 new homes in those thousands of acres of rolling countryside.

3. That's there's nothing we can do to encourage more efficient use of existing land and buildings.

But it's a start at least.


James Higham said...

Currently builders lose planning permissions after three years unless work has started.

Yep but that's a bit fuzzy, as there is started and started. I can put a set of steps in and I've 'started'.

Mark Wadsworth said...

JH, exactly. In the article they refer to this as "digging a trench".

Francis said...

I don't get this. So they lose the planning permission if they don't use it?
Can they just apply for it again?

Mark Wadsworth said...

F, exactly. That wasn't really the point of my post, their suggested solutions won't work and address the wrong problem anyway. But as a matter of fact, the large 'homebuilders' are mainly just land bankers, as the article says.

DBC Reed said...

The supporting reportage in the Observer states that things have deteriorated to the point that "the average couple in the private rented sector now hands over roughly half their salary to their landlord each month." It is amazing that our elected representatives and their civil service back up have not noticed this problem developing.What have they been doing? Suggest a Wanking at Work initiative to find out what's been going on , headed up by someone like pillar of the establishment QC John Smyth who set about (and how) reducing wanking among public school boys some time ago .However among the class of public school wankers in general this harsh conditioning appears to have worn off.

DBC Reed said...

On a more serious note: it looks like Homeownerism in the UK has run into terminal trouble.The Tories have made it clear over the weekend that they can no longer provide private sector housing that continually inflates in value. Even when Big Knickers started out, it was obvious (except to a Chemistry graduate)that there was an upper bound beyond which house prices could not go,though she could see the dangers of wage inflation (caused by Nixon's closing the gold window) and raised illegal national musters of police to crack down on the miners (who were merely trying to save their jobs being exported Trump style).
Once it sinks in that people no longer have a right to unearned, untaxed house price rises, the general disillusionment is going to be tragic.
We need to box clever. From my experience leading wildcat strikes, the moment of dangerous weakness is when you start winning.
I would guess that the Tories will double up on the attacks on immigrants and nasty treacherous Europeans who don't recognise the UK's natural superiority, to appeal to the Daily Mail troglodytes.

Dinero said...

Is there any credibility in the reported UK stat that there is more land used for golf courses than under houses.

Bayard said...

"I would guess that the Tories will double up on the attacks on immigrants and nasty treacherous Europeans who don't recognise the UK's natural superiority, to appeal to the Daily Mail troglodytes."

Much as I tend to disagree with you on many things, in this I fear that you are right. The Tories are becoming more (National) Socialist by the day.

However, I am still not totally convinced that the emphasis on pandering to the racists and xenophobes is not some deep-laid Establishment plot to discredit the Brexit movement. Certainly the Leave supporter = racist meme seems to have got a good hold on the public consciousness, and not just amongst the Remainiacs.