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What the Conservative manifesto should pledge on housing

    This piece was originally published by the Telegraph as part of their General Election series.

     

    A great opportunity faces the next government. Popular demand for new housing has never been higher. In 2010, the British Social Attitudes Survey found that 46% of respondents said they would oppose any new homes being built in their local area. In 2014, this opposition had fallen to just 21%. Similarly, those supportive of the construction of new homes in their local area climbed from 28% in 2010 to 56% in 2014. Nimbyism is not dead – but it is waning.

    As a result, housing is an increasingly salient political issue. Voters now consider housing to be one of the five most important issues facing Britain today, ahead of education, poverty, defence and foreign affairs, and crime. Why? Simply because there are simply not enough good homes for people to live in. Those under the age of 35 increasingly find that they cannot afford to buy their own home – which is not only disillusioning for them but also a major concern for their parents.

    And the economic consequences of our broken housing market are considerable: by tying up significant sums of cash in unproductive assets, high house prices contribute to the UK’s low productivity. They also distort the labour market and force many working people to waste largely uncomfortable hours commuting to work: if it were somehow possible to scrap commuting altogether, it has been estimated that the UK economy would see a productivity boost worth £12 billion a year.

    The current system conspires to make it not in the interest of any individual stakeholder to take on this challenge. It is a dysfunctional market.

    Planning restrictions, fragmented land ownership, lack of institutional capital funding and the tax treatment of new development have combined to stifle new initiatives. Smaller housebuilders have been squeezed out of the market, stifling innovation and diversity of supply. It is telling that no new towns have been built in this country since Milton Keynes back in the 1970s.

    That is why, for electoral, economic and social reasons, bold ideas for housing are needed now. And to be successful, any new initiative will requires co-operation of the full spectrum of relevant parties including central and local government, landowners, developers, financial institutions, local councils, planning officials and local residents, all of whom need to be involved from an early stage in the development of high quality, innovative new towns and urban extensions.

    To achieve this, it is crucial to have a mechanism whereby community co-operation is incentivised, where the go-ahead for development is recognised at an early stage by central and local government and where a simplified streamlined planning system can be implemented rapidly and effectively.

    Let’s call such areas "Pink Zones" (pink as in the lessening of red tape). Funding institutions would then have the confidence to support specific schemes. This should also trigger new ways on constructing homes and places of business. It could also encourage some much needed innovation in building techniques, which have hardly changed in Britain in the last half century.

    The new homes could be built by a wide range of developers: volume housebuilders, niche market operators, small and medium sized local builders, individuals, and co-operatives. As well as modular construction, other methods for scaling up could be utilised such as those that can be seen at Chapelton of Elsick, a new community that is being built ten miles south of Aberdeen, and, on a larger scale, at Newquay in Cornwall, where a pattern book and building code based approach is employed to ensure quality and sustainability in domestic architecture while also supporting scaling up of house construction.

    Adopting this approach should provide a major boost to smaller builders and new entrants. The housing market would be more competitive with new firms bringing forward new approaches and new designs which could test ideas ranging from "smart cities" to energy-efficient housing. And the greater number of new homes being built would – gradually – mean that house prices would become both more attractive to purchaser and more affordable.

    Tim Knox was Director of the CPS from 2011-2017. Before he was Director, Tim was the Editor at the CPS - a position in which he was responsible for publishing papers by every Conservative leader since Mrs Thatcher as well as by hundreds of leading academics and opinion formers.

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