Housing and Planning Bill

James Cartlidge Excerpts

Tuesday 3rd May 2016 Commons Chamber

[James Cartlidge (South Suffolk) (Con)]

On the question of affordability and starter homes, the hon. Member for Hornsey and Wood Green (Catherine West) mentioned the average deposit in London. However, a very big cash cost for any first-time buyer—or indeed any buyer—is stamp duty. Can the Minister confirm that the stamp duty payable on a starter home would apply to the discounted price and would therefore also be 20% lower?

[Brandon Lewis]

My hon. Friend makes a very good point. The stamp duty will apply to the price paid for the property, so it will apply to that reduced price. That will provide a further benefit for people buying a new home.

We are absolutely determined to deliver the number of starter homes that we promised, in order to help first-time buyers, who were the worst-hit part of the homebuying sector in Labour’s great recession. However, in passing Lords amendments 8 and 9, the other place is seeking to stop us. This House should not stand for that. Those amendments would remove from the Bill the power to set a national starter homes requirement on housing sites. The other place has proposed to replace that power with a locally set requirement that would be effective only when local authorities had completed studies of local housing need and viability.

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[Dr Roberta Blackman-Woods (City of Durham) (Lab)]

I thank their lordships for their amazing work on this Bill. Thirteen defeats and a string of concessions means that some of the sharpest edges have been knocked off a very bad Bill, but it remains an extraordinary and extreme piece of proposed legislation. Concern is being voiced by housing experts, charities, house builders, mortgage lenders, and Conservatives across a range of council leaders, MPs and peers. Doubts about the Bill matter, but even more important are the deeper doubts—on all fronts and with good reason—about whether the Conservative party is competent to fix our housing crisis.

Since 2010, home ownership has fallen, homelessness and rough sleeping have doubled, private rents have soared, housing benefit costs have ballooned, and during the last Parliament, fewer new homes were built than under any peacetime Government since the 1920s. This Bill does little to tackle the overall housing shortage or produce more housing across all tenures, including housing to rent as well as buy. With the exception of provisions on rogue landlords, it does nothing to improve the private rented sector on which so many people now rely.

[James Cartlidge]

When the hon. Lady talks about the affordability crisis, does she think that any part was played in that by the 200% increase in house prices between 1997 and 2008, as a result of a woefully badly regulated mortgage sector?

[Dr Blackman-Woods]

As the hon. Gentleman will know, Labour produced more than 1 million more homeowners during our time in government. This Bill shows that the current Government have no long-term housing plan for the country.

--- Later in debate ---

[Tom Brake]

I am a member of Sutton Housing Society Ltd, although I have no pecuniary interest.

I will start where the Chair of the Communities and Local Government Committee finished, on the issue of supply. The Bill should be about supply in the widest sense, but while I do not doubt that Ministers are seeking to solve housing problems for some, I am afraid that the Bill will do nothing for the people I see regularly in my constituency surgeries. Nothing in it will help the single mother I referred to earlier, living and working in London on £17,000 a year and seeking a better private rented property or social housing through a housing association. Nor will it help the couple I saw a few months ago in a two-bedroom flat with three children, who could not afford the rent in a housing association property, let alone afford to buy in London.

We have heard about the Khan amendments, but perhaps I could throw in the Caroline Pidgeon amendments, which unfortunately do not feature in any of the strings today. The advantage of her proposal for London is that it includes a revenue stream of £2 billion to deliver the housing. Many have said they will deliver housing, but in practice we are still hundreds of thousands of properties short.

The Bill has been subject to an extraordinary number of amendments and no fewer than 13 Government defeats in the Lords, which is testimony to the fact that the Bill was presented to the House lacking a huge amount of detail and clarity. I thought we might get some here but that has not, I am afraid, been the case. The Bill contains provisions that will have extremely concerning consequences for housing in the UK and affordable housing in particular, and the fact that there has been such united cross-party opposition to the Bill in the Lords, including from Cross Benchers, indicates the depth of concern.

The Bill’s focus is on home ownership for better-off renters, but it neglects affordable homes to rent and clearly seeks to reduce the number of social homes provided by local authorities. As Opposition Members have said, the impact will undoubtedly be a rise in homelessness. Furthermore, far too much is being imposed on local authorities, in terms of sales of higher-value council homes, pay to stay and secure tenancies. It is encouraging, however, that the Government have taken on board some of the serious concerns and made concessions in relation to amendments 26 to 36, on abandonment, and amendments 90 and 91, on mandatory electrical safety checks for private tenants. Those are welcome.

I also welcome the Government’s recent inclusion in the Bill of a commitment to replace all homes sold off under the sale of higher-value properties. Replacements are critical to whether the Bill will have a devastating impact on social housing. In the past, promises of replacement have been made but not delivered, and as several Members have mentioned, it is critical that the replacement is like for like, in terms of the type of property, and in the same area.

In London, pay to stay is of particular concern. Some Members might be aware of a report by the Joseph Rowntree Foundation in 2014 that found that a family of two adults and two children needed an income of £40,000 to have an acceptable standard of living. That was an average across the whole country. Given that that was two years ago and an average for the country as a whole, it is clear that families on £40,000 in London would not be wealthy. I hope that the Government will look favourably on amendment 57, which would raise the threshold by £10,000 and might actually get people up to an acceptable standard of living before their income is reduced by rising rents in their social property. In addition, I will certainly support amendment 55, if it is pressed to a vote, and amendment 54. If they are pressed, I will also support amendments 9 and 47, which were debated earlier.

With that and within your five-minute margin, Madam Deputy Speaker, I will sit down.

[James Cartlidge]

I start by declaring my housing interests in the Register of Members’ Financial Interests. They include a significant involvement in shared ownership, which it is almost impossible not to speak about in such a debate.

I want to focus on starter homes, on how they interact with other affordable home ownership products and, more importantly, on how they will affect my constituents. I am intrigued by the idea, in amendment 1, that someone would repay the 20% discount over 20 years. It is unclear how it would work in practice—I apologise for not having studied the Lords Hansard for a lengthy explanation. Would the money be repaid on the sale of the property only, or would it be a credit agreement repaid annually? If, on the sale of a property, someone’s circumstances had worsened or they were unemployed—people sell their properties when their circumstances change—would they still have to repay the equity discount from which they had benefited? We must remember that whenever we add complexity to a home ownership product, lenders do not like it and are less likely to be involved. I make that impartial observation as a former mortgage broker.

My other point about amendment 1 is that we must remember that it is relatively unprecedented in affordable home ownership products to have repayment of the subsidy from which the homeowner has benefited. With shared ownership, grant is implicit, but when someone sells their share, they do not repay the part that came from the Government grant. They have become a homeowner, and they benefit or otherwise from the increase in the value of the share.