Housing and Planning Bill

Debate between Kevin Hollinrake and David Lammy

Tuesday 3rd May 2016 Commons Chamber

[Kevin Hollinrake]

Opposition Members have made the point that starter homes will be built, rather than affordable homes to rent. That is, of course, true to some extent, because people want to buy homes and people on lower incomes have been excluded from the housing market for too long. We have been building an average of 50,000 affordable homes to rent for the last 20 years. Why have we not been building more affordable houses for sale, if that is what people want? Given that we have 20 years of catching up to do, it is absolutely right for the Government to set the ambitious target of building 200,000 starter homes over the next four years.

The hon. Member for Dulwich and West Norwood (Helen Hayes) gave the example of someone who will have earned £40,000 by the end of this year and is living in an affordable rented property. The average price of a London home for a first-time buyer is £250,000. I believe that, under this policy, a starter home in London could be built for about £200,000. The information provided by Shelter about the unaffordability of starter homes in most local authority areas is flawed, or deliberately misleading, because it is based on the median house price. First-time buyers buy at around 25% below the median house price, and in my area, the average house price is about £200,000.

[Mr Lammy]

Does the hon. Gentleman dispute the figures given by the Office for National Statistics, which has said that the average first-time buyer in London paid £400,000 last year?

[Kevin Hollinrake]

I am not aware of the figures to which the right hon. Gentleman has referred, but, according to the Council of Mortgage Lenders, the average house price for first-time buyers in Greater London is £250,000. In my area the average house price is more than £200,000, but we have some very nice villages in which the average is £300,000. First-time buyers will pay about £150,000, and will move a few miles away from those nice villages to buy in a more affordable area. If they can buy at 20% below that value, they will pay £120,000. Bringing property for home ownership within the reach of many more people is absolutely the right thing to do, and this policy is clearly very popular with first-time buyers.