Housing White Paper: What’s in it for Agents?

sajid_javid_secretary_of_stateThe wait is over! Communities Secretary, Sajid Javid, has spoke. He has told us all that the housing market is ‘broken’ and we need ‘more houses’. Radical thinking, I don’t know where they get their ideas.

As well as these important words, Mr Javid has also published the oft-expected and somewhat delayed Housing White Paper. Which is where things start to get slightly more interesting.

Launching the command paper the minister told the House of Commons:

“Walk down your local high street today and there’s one sight you’re almost certain to see. Young people, faces pressed against the estate agent’s window, trying and failing to find a home they can afford.

“With prices continuing to sky rocket, if we don’t act now, a whole generation could be left behind. We need to do better, and that means tackling the failures at every point in the system.

“The housing market in this country is broken and the solution means building many more houses in the places that people want to live.

“Today we are setting out ambitious proposals to help fix the housing market so that more ordinary working people from across the country can have the security of a decent place to live. The only way to halt the decline in affordability and help more people onto the housing ladder is to build more homes. Let’s get Britain building.”

What does that mean in reality?

Well, the three main elements of the document are:

  • Getting the right homes built in the right places – consulting on the principle of a new, standardised way of calculating housing demand to reflect current and future housing pressures. Every local area will need to produce a realistic plan and review it at least every five years. Currently 40% of Local Planning Authorities do not have an up to date plan that meets the projected growth in households in their area. Fixing this will help make sure enough land is released for new homes to be built in the parts of the country where people want to live and work and ensure developments take heed of local people’s wishes, while continuing with maximum protections for the green belt. Councils and developers will also be expected to use land more efficiently by avoiding building homes at low density and building higher where there is a shortage of land and in locations well served by public transport such as train stations.
  • Speeding up house building – giving local authorities the tools to speed up house building as well as powers to make sure developers build homes on time. The government will make it easier for councils to issue completion notices, shortening the timescales to require developers to start building within two years, not three, when planning permission is granted.   We will also require greater transparency and information from developers on their pace of delivery of new housing so councils can consider this when planning their local need. This will help address the serious and growing gap between the number of planning permissions granted and the number of new homes completed.
  • Diversifying the market – action to help small independent builders enter the market given including through the £3bn Home Building Fund. Currently around 60 per cent of new homes are built by just 10 companies. The fund will help us to build more than 25,000 new homes this Parliament and up to 225,000 in the longer term by providing loans for SME builders, custom builders, offsite construction and essential infrastructure, creating thousands of new jobs in the process.

What about letting agents?

It is definitely a change in tone. The Government seems to have realised that there is more to housing than home ownership. Likewise, renting is on the radar, but in flow terms rather than existing stock for the most part.

Despite a lot of speculation that the 12 month AST was about to go the way of the dodo, it looks like the Government has seen fit to give the PRS a reprieve this time around, which makes a pleasant change! Of course the fees ban is there, but we knew all about that.

The writing does seem to be on the wall though. The call for longer, and more diverse tenancy options, seems very much upon the wall. The question is; can the sector – landlords and letting agents together – offer the market enough to prevent wholesale regulation?

We often talk of the impressive flexibility offered by the AST, but how often is it exercised? I suspect not enough to keep this particular minister.

Judge for yourself, and read the full paper here: Fixing our broken housing market

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