New shadow housing minister unveils plans to head off projected shortage of a million homes by 2022
Five new towns will be built in the first five years of a Labour government under plans being drawn up by the party, its new shadow housing minister has claimed. Emma Reynolds said the towns would be built in those areas of greatest need in a bid to tackle a projected shortage of a million homes by 2022, which experts say would force many young people to live with their parents well into their 30s.
The Labour MP for Wolverhampton North East added that in finding sites for the new urban centres the party was aware of the benefits of locating them near the proposed high-speed railway from London to the north-west, known as HS2.
A spokesman for the Home Builders Federation told the Observer that the assumption within the industry was that most new towns would be built within easy reach of London to satisfy those with jobs in the capital but who were unable to live there.
Outside London, the local authorities with the greatest need for new homes due to rapidly rising populations are East Cambridgeshire and Welwyn Hatfield in Hertfordshire, according to government figures.
Reynolds said she understood concerns about the potential for urban sprawl blighting the countryside and the sensitivities of those living in what are now quiet villages. But the shadow minister, a former special adviser to the then minister for Europe, Geoff Hoon, said she believed that the frenetic housebuilding of the postwar years – in which, among others, Basildon in Essex and Stevenage in Hertfordshire emerged – should be a model for Labour.
“The last time there was a massive increase in housing supply was in the postwar period and we want to recapture that spirit,” said Reynolds. “I don’t think we will do as well as the Attlee government, with 11 new towns; I think that is quite a lot. I would love to think we could deliver four or five, and that would still be significant.
“At the moment we are building less than half of the houses we need to keep up with demand, and that is why the market is so dysfunctional.
“I think there is enough land in the country to meet housing need and have a fantastic countryside. Of course, we want to protect that and have green spaces. This isn’t just about numbers, and that is why the garden city model is interesting. We want quality new towns.”
The number of affordable houses and flats built in England fell sharply last year, according to government figures released last week, highlighting the pressures facing first-time homebuyers. Just 107,950 homes were built in 2012-13, well short of the 250,000 to 300,000 extra properties that experts believe are needed every year to keep pace with growing demand.
Reynolds said the government had done next to nothing to promote housebuilding, but that Labour would create an incentive for local authorities to hand over large swaths of land to development corporations.
The Treasury would then act as a guarantor for the corporations when they borrowed money on the private markets to fund the building of the new towns. Labour plans to build 200,000 new homes in every year of a new administration.
Reynolds, who owns a home in Wolverhampton which she bought when she was 30, and rents a flat in London, said the coalition government had merely promoted demand with its help-to-buy schemes, under which the Treasury offers a loan to buyers of up to 20% of the value of their property purchase if they have a 5% deposit. She said: “They have done next to nothing on supply”.
Reynolds also revealed plans to clamp down on a growing trend within London, in particular, of foreign investors buying properties, but leaving them empty. She said London was being hollowed out and that those buyers were doing little or nothing for the British economy.
Local authorities can currently charge those who own empty homes 50% more in council tax. Labour, Reynolds said, would give local authorities the power to charge even more and the ability to do so after a year or less. She added that currently investors could avoid additional council tax by furnishing their property with a table and chair, but that this loophole would also be closed.
A former lobbyist in Brussels who was shadow Europe minister until her promotion in October, Reynolds said: “I don’t have any problem, as an internationalist, with people coming here to work, renting or buying and paying into the economy. I do have a problem when people are just buying property and not paying into the system.”
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