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| Boris Johnson's stamp duty plan offers solution to affordable housing supply | Boris Johnson's stamp duty plan offers solution to affordable housing supply |
| (7 months later) | |
| Boris Johnson last week called for City Hall to be able to retain stamp duty fees on all property sales, estimated to be around £1.3bn per year, in order to build the homes the city needs. It is encouraging to see the mayor of London clearly recognising that urgent action is needed to tackle the housing crisis in London and that long-term funding is vital to solving this problem. | Boris Johnson last week called for City Hall to be able to retain stamp duty fees on all property sales, estimated to be around £1.3bn per year, in order to build the homes the city needs. It is encouraging to see the mayor of London clearly recognising that urgent action is needed to tackle the housing crisis in London and that long-term funding is vital to solving this problem. |
| The social and economic costs of the housing crisis are serious. Unaffordable rents in the private rental sector, unobtainable mortgages, growing waiting lists for social housing and rising homelessness is causing real distress in communities across London. At a time when people are confronted with cuts to their benefits, the shortage of affordable housing will only exacerbate the difficulties they face trying to manage the changes. For instance, if people want to downsize homes because of the so-called bedroom tax, the shortage means many will simply not have that option – there is nowhere to go. | The social and economic costs of the housing crisis are serious. Unaffordable rents in the private rental sector, unobtainable mortgages, growing waiting lists for social housing and rising homelessness is causing real distress in communities across London. At a time when people are confronted with cuts to their benefits, the shortage of affordable housing will only exacerbate the difficulties they face trying to manage the changes. For instance, if people want to downsize homes because of the so-called bedroom tax, the shortage means many will simply not have that option – there is nowhere to go. |
| The availability and affordability of housing is now one of the top three challenges for employers in the capital, representing a significant threat to London's economic prosperity and future growth. While most people accept there needs to be a reduction in welfare spending, the housing benefit bill is not going to go down if rents are unaffordable. | The availability and affordability of housing is now one of the top three challenges for employers in the capital, representing a significant threat to London's economic prosperity and future growth. While most people accept there needs to be a reduction in welfare spending, the housing benefit bill is not going to go down if rents are unaffordable. |
| London's population has grown by more than half a million over the last decade. And it is projected to increase by around 1 million more over the next 10 years. Demand has been outstripping supply for far too long, and radical action is needed. Without it, living in London will be an aspiration, not a reality, for many people. | London's population has grown by more than half a million over the last decade. And it is projected to increase by around 1 million more over the next 10 years. Demand has been outstripping supply for far too long, and radical action is needed. Without it, living in London will be an aspiration, not a reality, for many people. |
| Increasing the supply of affordable housing should be the top priority for the government. And as the mayor pointed out in his speech, housing is like any other vital infrastructure: it needs long-term vision and investment. There is public support for this; a poll this week showed almost 60% of adults think there is not enough affordable housing in their area and 82% think the government should give the issue more attention. | Increasing the supply of affordable housing should be the top priority for the government. And as the mayor pointed out in his speech, housing is like any other vital infrastructure: it needs long-term vision and investment. There is public support for this; a poll this week showed almost 60% of adults think there is not enough affordable housing in their area and 82% think the government should give the issue more attention. |
| The mayor's answer to this is for London to retain its stamp duty receipts. This would give developers and housing associations a long-term, stable income stream, creating a more predictable and secure funding environment which would lever in additional institutional investment. | The mayor's answer to this is for London to retain its stamp duty receipts. This would give developers and housing associations a long-term, stable income stream, creating a more predictable and secure funding environment which would lever in additional institutional investment. |
| Not only would this enable the much needed increase in affordable homes, it would also mean more jobs, more growth and more wealth generated in the capital. | Not only would this enable the much needed increase in affordable homes, it would also mean more jobs, more growth and more wealth generated in the capital. |
| This is a viable, long-term solution to the uncertainty and anxiety over funding for affordable housing. | This is a viable, long-term solution to the uncertainty and anxiety over funding for affordable housing. |
| The affordable rent model, which ends in 2015, is unsustainable and capital investment in affordable housing is needed to tackle under-supply. Ministers and officials in the Department for Communities and Local Government are working on how the social housing sector will be funded after 2015, but the uncertainty about capital grant means ministers will struggle to address the problem. | The affordable rent model, which ends in 2015, is unsustainable and capital investment in affordable housing is needed to tackle under-supply. Ministers and officials in the Department for Communities and Local Government are working on how the social housing sector will be funded after 2015, but the uncertainty about capital grant means ministers will struggle to address the problem. |
| Central government funding for affordable housing is an investment, not a subsidy. And by investing in housing in the capital, the chancellor would be providing a huge boost to homes, jobs and economic growth. Many commentators suggest it is difficult to see the chancellor diverting £1.3bn from the Exchequer to City Hall. But with the budget a little over five weeks away, George Osborne should be bold and look at this proposal seriously. | Central government funding for affordable housing is an investment, not a subsidy. And by investing in housing in the capital, the chancellor would be providing a huge boost to homes, jobs and economic growth. Many commentators suggest it is difficult to see the chancellor diverting £1.3bn from the Exchequer to City Hall. But with the budget a little over five weeks away, George Osborne should be bold and look at this proposal seriously. |
| Stephen Howlett is the chief executive of Peabody | Stephen Howlett is the chief executive of Peabody |
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