Housing and Planning Bill
Debate between Brandon Lewis and Chris Philp
Brandon Lewis
My hon. Friend makes a very good point. As I travel around the country, I find that people are frustrated and want us to get on with the policies that they elected us to deliver. That is because they see that Labour Members are trying to stall them through political posturing at pretty much every opportunity.
Let me also say, however, that some are understandably focused on London, where there is real pressure. We have my hon. Friend the Member for Richmond Park (Zac Goldsmith) to thank because we worked with him to ensure that for every home sold in London, at least two homes will be built, driving a direct increase in housing supply.
Chris Philp (Croydon South) (Con)
I must say to the Minister, with all due respect to my hon. Friend the Member for Rossendale and Darwen (Jake Berry), that starter homes will work in many London boroughs, too. In my borough of Croydon, the average starter home will cost £190,000. With a help-to-buy mortgage, a £10,000 deposit is necessary and a couple, each earning £22,500, can afford to buy. In Croydon, as I say, it will work.
Brandon Lewis
My hon. Friend highlights how this policy is about delivering for people on the ground. While Labour Members want to pontificate, we are going to stay focused on delivering homes for people across our country and here in the capital city of London.
Chris Philp
I draw colleagues’ attention to my entry in the Register of Members’ Financial Interests.
Let me start by responding to a point made by the hon. Member for City of Durham (Dr Blackman-Woods). She referred to the Government’s house building record; let me tell the House that it is a fine one. In the last year of the previous Labour Government, only 125,000 units were started. Last year, that figure had increased to 165,000 units, so this Government have a record they can be proud of when it comes to building new homes.
The hon. Lady and the Chair of the Select Committee, the hon. Member for Sheffield South East (Mr Betts), also talked about the need to increase supply more generally, and we on this side of the House wholeheartedly agree with that. There is much in the Bill with which their lordships have thankfully chosen not to disagree that will increase supply, including local development orders, the requirement to have local plans in place by 2017 and the work of the London Land Commission. There is a huge amount in the Bill that will increase supply, which Opposition Members have asked for.
I want to say a word in support of starter homes. We know that 86% of the citizens of this country aspire to own their own home, and starter homes will help them to do that. By owning their own home, they will benefit economically as house values go up and they pay down their mortgages, and social benefits will accrue as well. We have heard a lot from Opposition Members about the importance of settled and rooted communities. What better way is there of having a settled and well-established community than by ensuring that it is a community of people who own their own homes?
Opposition Members also talked about affordability, speaking about the ceiling of £450,000 in London and £250,000 outside the capital. That is a ceiling; it is a maximum. My borough, the London Borough of Croydon, is the largest borough by population. The average starter home there will cost £190,000. That means that, with Help to Buy, a deposit of £10,000 will secure a home, and a couple earning £22,500 each will be able to afford to service the mortgage on it. In the London Borough of Croydon, starter homes will work.
On the point about increasing the supply of council houses, I must respectfully point out that in the past five years of a Conservative Government, we have built more than were built in 13 years under Labour. I would further point out that under the rules governing the disposal of high-value council houses, one such house will replace every one that is sold outside London, and it will be two for one in London. These measures will actually increase the supply of council housing across London as a whole, so they should be welcomed.
The problem with the amendment relating to the 20 years’ discount is that if someone wants to move from their starter home, they will need to realise its full market value in order to move up the property ladder to their second and then their third home. I believe that we might see regulations that would allow for a sliding scale, perhaps between five and 10 years. Given that the average length of time spent in a property is about seven years, that would make sense.
On the amendment about local authorities being able to circumvent starter home provisions, I must point out that our proposals were part of a national manifesto commitment that was approved by the electorate at the general election, so it is quite right that they should now be implemented nationally. Local issues will be fully accounted for via the 20% discount on the open market value, which will reflect local housing need.
There is more that I could say, but I am sure that we all want to hear from the Minister. I support the Government’s position on the amendments and look forward to supporting them in the Lobby.
Brandon Lewis
With the leave of the House, I shall respond to the debate. I thank all Members who have spoken about such a wide variety of subjects.
I want to make a short speech to outline some important issues. Conservative Members feel strongly that we want to return the Bill to the other place with the clear message that we want more homes to be built, not fewer; more homeowners, not fewer; and progress on increasing our housing supply. Let me put this in context by quoting from our manifesto, which resulted in our being given a mandate at the general election. It stated:
“The chance to own your own home should be available to everyone who works hard…We will…build more homes that people can afford, including 200,000 new Starter Homes…for first-time buyers under the age of 40…We will give more people the chance to own their own home by extending the Right to Buy to tenants of Housing Associations…We will fund the replacement of properties sold under the extended Right to Buy by requiring local authorities to manage their housing assets more efficiently, with the most expensive properties sold off and replaced as they fall vacant.”
That is a direct quote from our election manifesto, and it is a promise to the people of Great Britain that we intend to keep. We also feel strongly that the Houses of Parliament should respect our mandate.
Let us also consider this in the context of the work we have been doing, which the Bill will take further—[Interruption.] The number of new homes delivered in the past year was not as low as it was under the shadow Minister, the right hon. Member for Wentworth and Dearne (John Healey)—he did not find this debate important enough to speak in, other than from a sedentary position—when it was just 88,000. The number of new homes delivered last year was up by 25% on the previous year, thanks to the work that we have done, and 181,000 new homes were built. Housing construction orders have doubled since 2009 and registrations are at their highest level since 2007. In fact, new housing registrations have increased in England more than three times as much as in Labour-run Wales. That gives us a clue about what Labour is doing for housing, and we as a Government are determined to go further.
When the House was asked to give the Bill a Second Reading, it delivered one of the largest majorities in this Session. That is why we believe it is important that we see more progress on delivering on the contract that we now have with the British people, who want more homes that they can afford to buy, as well as an overall increase in supply. The House once again has an opportunity to demonstrate its commitment to helping those who work hard to achieve their dream of home ownership. We are a Government of aspiration and opportunity, and we are getting Britain building again.
We are also a Government who will get our social housing working as efficiently and effectively as possible, not only so that more people can own their own home, but to increase the affordable housing supply overall. We will ensure that one new home is built for every high-value property sold outside London and, thanks to my hon. Friend the Member for Richmond Park (Zac Goldsmith), two will be built for every such home sold in London. That represents real delivery from someone who wants to represent London, with a plan to deliver more homes for London, but we have not seen that from Opposition Members. There is now a guarantee that one affordable home will replace every one sold outside London, and two in London.
We are delivering on our promises and we will continue to deliver on our contract with every person in this country that results from the mandate that they gave us. They gave us a mandate to deliver fair social rents through our first Conservative Budget in 19 years. They also gave us a mandate to deliver the ground-breaking Bill that we are discussing today. I am proud to be here today to enable us to go further with a Bill that will deliver more homes for our country.
Housing and Planning Bill
Debate between Brandon Lewis and Chris Philp(8 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Chris Philp
Most first-time buyer households have two people’s incomes contributing, which improves the affordability.
On the specific question raised by the hon. Member for City of Durham on amendment 34 about preventing buy-to-let investors, clause 2(1)(b) says starter homes will apply only to “qualifying first-time buyers”, which is very clear.
In summary, I strongly support the starter homes concept and the concept of a property-owning democracy, and I support the 86% of our constituents who want to buy their own home.
The Minister for Housing and Planning (Brandon Lewis)
We have had an extensive discussion both in Committee and tonight, and I look forward to rest of tonight’s debate, not least as it might allow us to see if the current shadow Front Bench is still the shadow Front Bench by the time we finish.
We have had extensive discussion on the Opposition amendments on starter homes, particularly in relation to clause 1, and the hon. Member for City of Durham (Dr Blackman-Woods) has returned to that today, repeating points made in some of our previous debates. Since we discussed these clauses in Committee, our spending review has doubled our investment in affordable housing. The Prime Minister announced just yesterday that £1.2 billion of our starter homes funding will in the first instance support further brownfield site preparation, and that builds on the £36 million made available late last year.
Clause 1 sets out our position clearly—our manifesto commitment being delivered to build 200,000 starter homes. Clause 1 includes a clear definition to be applied nationally, and I hope the House will agree that we should not water it down through the proposed amendments. We strongly believe that new housing developments need to be supported by improvements in local infrastructure—this particularly covers amendment 32. Starter homes reforms do not change this. Starter home developments will still be required to have section 106 agreements to provide necessary site-specific infrastructure.
Turning to amendments 33, 34, 35, 37, 38 and 39, we need to be clear that these would remove the real benefits starter homes offer to young people—the very people we are looking to help. So I maintain that our model, as defined in clause 2, should stand to define our product clearly and support national delivery.
The hon. Member for City of Durham referred to amendment 39. I made it clear in Committee—Members can read what was said in Committee—that the regulations will specify that post-sale restrictions on sale and letting will exist and there is likely to be a period of five years before a starter home can be sold or let at open market value. I defend the right of any homeowner to have the same rights as any other homeowner to treat their home properly. If someone can never realise more than 80% of the value of their property, they lose the ability to move upwards in the housing market. This risks stagnation, rather than mobility. I want to incentivise young people and families to move onwards and upwards, and our model will enable families to do just that.
Turning to amendments tabled by my hon. Friend the Member for South West Devon (Mr Streeter), the hon. Member for Westmorland and Lonsdale (Tim Farron) and the right hon. Member for Wentworth and Dearne (John Healey), I want it to be absolutely clear that the Government strongly support the need for a range of products to improve access to homeownership, and other products can perform a valuable function, too. It is for councils to consider whether these products should form part of their affordable housing ask on any given housing site. The clause will not prevent such developments from coming forward; nor will it prevent councils from securing other forms of affordable housing.
We are also introducing flexibilities in the Bill to encourage councils to build their own affordable housing. Let us be clear: 2014 saw the highest level of council housing starts for 23 years. However, we make no apology for prioritising support for low-cost home ownership and for making sure that we do what we can to get young people on to the housing ladder, rewarding their hard work and ambition.
I note the support for rent to buy, which is a product that we in the Government have supported as well. We will continue to focus on it, but at this stage I do not want to dilute our clear focus on delivering starter homes for first-time buyers. I accept that the need will vary across the country, which brings me to amendment 41. We need to be able to provide more starter homes across the country, and the outcome of our consultation will involve setting different requirements in different areas. However, I want to wait for the outcome of the consultation before I make any final decisions.
As I said in Committee, amendment 42 is unnecessary. Again, our consultation will seek views on the type of site that should be exempt from the duty, and I believe that it is right to await the outcome of that consultation. We will then publish a full range of exemptions. On Amendment 43, much of the information that the amendment proposes to have included is already reported. I want to reassure Members that we will consult on the proposed regulations relating to clause 5, and this will include details of the proposed monitoring reports.
On amendments 44 and 46, we are now in a position in which we can no longer afford to hold on to employment land indefinitely if it is not in productive use. I expect local authorities to continue to examine applications relating to exemption sites with the same rigour with which they examine other applications. I am therefore not persuaded that either of the amendments is required. If land is in active use, or if there is robust evidence that it could soon be in productive use for employment uses, a council will be free to consider it as part of the planning process.
Turning to amendment 45, I want to reassure Members that it is our firm intention that any compliance direction should be a backstop provision. We expect that provision to be used only rarely, but it will be an incentive to ensure that we do our bit to deliver these new starter homes for first-time buyers.
Housing and Planning Bill (Fifth sitting)
Debate between Brandon Lewis and Chris Philp
Brandon Lewis
The hon. Lady is absolutely right, but that again highlights the difference between the Government and the Opposition, because she misses the reality that neither the mortgage company nor the property owner can ever realise 100% of the property’s value, which means that, at the point of taking out the mortgage, someone is effectively taking out a 100% mortgage. Banking and gambling on a future increase in a property’s value is partly what got this country into the mess with house prices we suffered under the previous Labour Government, so I am not prepared to put first-time buyers at risk in the way she outlines.
The average market price for homes bought by first-time buyers in 2014 was £173,000 in England, excluding London. That compares with an average house price for England last year of £243,000. In London, first-time buyers paid £364,000 on average compared with an average house price for London of £470,000.
We expect starter homes to be an entry-level property, valued at below the average first-time buyer price for the local area. We have examined affordability of homes for those who are currently in the private rented sector. If they were to buy in the lower quartile of the first-time buyer market, outside of London, up to 64% of households currently renting privately would be able to secure a mortgage on a typical starter home, compared with just 50% who could buy a similar property now at full market value.
Within London, up to 55% of households currently renting privately would be able to secure a mortgage on a starter home in the lower quartile of the first-time buyer market, compared with 43% who could buy a similar property now priced at full market value.
Chris Philp
Given how widely accessible the starter homes will be to first-time buyers on median and low incomes, does the Minister agree that it would be appropriate to define starter homes formally as affordable homes for planning purposes? Would the Minister consider introducing amendments to that effect?
Brandon Lewis
My hon. Friend makes an interesting point. There are things we will do in primary legislation and others we will do through regulations and guidelines, but I will consider his comments.
Those figures demonstrate that starter homes at a 20% discount will provide a genuine opportunity for home ownership for many more households. The Opposition wish to remove the 20% discount on local market values. Our model for starter homes, with the discount, gives people a real opportunity to secure themselves a lasting foothold on the property ladder. They will be given the opportunity to sell their property after five years, as currently planned, to realise its full value, enabling them to move onwards to new housing, should they wish, giving them the same rights in their property as any other homeowner, mirroring what happens with someone who acquires their home through right to buy.
We will deal with the five years provision through regulations, but amendment 67 would introduce another significant change, to restrict starter homes to an in-perpetuity model in which the discount is retained permanently with the property. I am very aware that there are discounted market sale products with in-perpetuity restrictions delivered across the country now. They offer an important opportunity and play an important part in the home ownership market.
However, it is not clear how far the majority of first-time buyers would want to be subject to restrictions in that way. In London and some rural areas where prices are high, people have accepted that trade-off between restrictions and owning a home in those locations, but that does not have to be the case everywhere.
In addition, such long-term restrictions can make it more difficult to sell and move on. If the property is sold at a discount, can the owner move upwards to a larger home or to a new area? Our intent is very clear: starter homes will continue to be provided through 2020 and well beyond. New supply of starter homes will become available for future first-time buyers who will benefit from the same opportunities as the early buyers.
Those homes will provide first-time buyers with the opportunity to move up to a larger home as their family needs grow or circumstances change. That is central to our vision for first-time buyers: a genuine discount that provides a genuine opportunity for a long-term future, and a determination to continue to grow and build that supply.
Oral Answers to Questions
Debate between Brandon Lewis and Chris Philp
Brandon Lewis
The hon. Lady may realise that there have been just over 1,000 housing starts in the last year in her area, which is well up on where it was before and, again, builds on the terrible situation we inherited some five years ago. I hope she will join me in thanking this Conservative Government for pledging to deliver affordable homes at the fastest rate in over 20 years and, of course, those 200,000 starter homes for first-time buyers at a 20% discount. Perhaps her party would like to get on board and support that work.
Chris Philp (Croydon South) (Con)
Does my hon. Friend agree that the way to address housing affordability is to increase supply? Can he confirm to the House that the approach which saw over 500,000 new homes built during the last Parliament will be continued?
Brandon Lewis
My hon. Friend makes a good point, and we seek to build on that by delivering affordable homes, including starter homes for first-time buyers, and making sure we increase supply. We have seen the increases over the last few years, and the recent figure of some 261,000 homes getting planning approval last year is pretty much a record level, and is a good sign that we have got the market moving in the right direction. We intend to build on that, and will do so.