With the next European Council not scheduled until December, political attention now turns to next month’s Budget. As I say in The Sun this morning, there are signs that the government is getting to the right place on housing. I understand that when Cabinet discussed the Budget this week, a frequent refrain from ministers was the need to be bold on housing. One ally of the Chancellor tells me, ‘Housing will be the big centrepiece of it’.
I understand from government sources that the Budget is likely to back both land release and the government directly commissioning houses. This means the government would free up public sector land and then get housebuilders to build thousands of homes on it. Because the government had commissioned the homes itself, they could come straight on to the market. Developers, by contrast, have an incentive to drip houses onto the market to so that an increase in supply doesn’t reduce prices.
I am told that the Treasury is also pushing for planning reform again; it wants to ease the restrictions on building on the green belt. It is making some progress on this argument. As for Theresa May herself, I am told that ‘PM has moved but is not entirely there yet’ on this issue. One Downing Street source stresses that she wouldn’t agree to anything that affects the green belt.
May has said that she wants to be the Prime Minister who fixes the housing market. This is a laudable aim as the broken housing market is distorting our society and politics. But if Theresa May is to turn around the decline in home ownership, which is now at a 30-year low, she’ll have to embrace planning reform as well as the government getting homes built.
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