Housing

Marcus Jones Excerpts

Wednesday 8th January 2014 Commons Chamber

[Hilary Benn]

The hon. Gentleman makes a perfectly fair point. As he knows, the housing market varies enormously between different parts of the country. In the city that he and I have the privilege of representing, the council’s assessment—which is supported by all the parties—is that we will need roughly 70,000 new homes in the next 15 years. That is a question of supply.

[Mr Marcus Jones (Nuneaton) (Con)]

Will the right hon. Gentleman give way?

[Hilary Benn]

I have given way a great deal. I want to make some progress, because lots of people want to speak.

Let us look at the situation in London. Here, we see new blocks being built and marketed to foreign investors, making it much more difficult for Londoners and others to get a chance to buy those homes. The shadow Housing Minister, my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), has said that that is wrong and called for action to require such homes to be marketed to Londoners and others who live in this country first, rather than being sold off-plan to investors abroad.

[Mr Marcus Jones]

Will the right hon. Gentleman give way?

[Hilary Benn]

I want to make some progress.

In the capital, about 50,000 homes are now sitting empty. That is why Labour would allow councils to double the council tax on empty properties. We would also deal with the loophole that allows overseas owners to claim that a property is their second home, simply because they have put a table and chair in it.

I asked the Secretary of State a specific question last March about whether foreign buyers would be able to benefit from the Help to Buy scheme, and his reply could not have been clearer:

“This scheme will not be available for foreign buyers; this is a scheme to help people from this country.”—[Official Report, 25 March 2013; Vol. 560, c. 1311.]

Will he confirm for the record that EU nationals who have come to the UK will not be eligible for assistance from the Help to Buy scheme? I will give way to him to allow him to answer. I notice that he does not wish to intervene. Perhaps a nod would do. This is the third time I have asked him about foreign buyers in relation to the Help to Buy scheme, and it is the third time he has been unable or unwilling to give me an answer.

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[Hilary Benn]

I am going to make some progress.

When Kate Barker carried out her review of the housing market a decade ago she found two factors that we need to consider. First, she said that

“limited land supply means the competition tends to be focused on land acquisition rather than on consumers”.

Secondly, she found that

“many housebuilders ‘trickle out’ houses…to protect themselves against price volatility”.

[Interruption.] Hon. Members say that that was a decade ago, but it is still going on. Roughly translated, it means that not all house builders have an incentive to build all the homes for which they have planning permission as quickly as possible or as quickly as the nation needs them to. That is a problem, and we have proposed a way of dealing with it. Even when times were good, when mortgage credit was readily available and house prices were booming, the house building industry was unable to build the number of homes required.

[Mr Marcus Jones]

The right hon. Gentleman mentioned the previous housing boom in 2006-07. Will he explain why the number of first-time buyers fell to its lowest level on record at that time, and why, following the moves made by the present Government, we are seeing the strongest growth in first-time buyer numbers for more than a decade?

[Hilary Benn]

As the hon. Gentleman is well aware, there was a very difficult period—[Interruption.] No, there was a collapse in the global economy. It is no good the hon. Member for Rossendale and Darwen shaking his head. The problems that we experienced in the United Kingdom were caused in particular by problems in the housing market in the United States of America. That is why we should be concerned by the threat of a housing bubble returning to the United Kingdom.

One of the answers must be to get more people building houses. [Interruption.] I am glad to see the hon. Member for Rossendale and Darwen nodding in agreement. Forty or 50 years ago, two thirds of the houses in this country were built by small and medium-sized builders. [Interruption.] The hon. Gentleman can carry on nodding; that is fine. I am grateful for his support. Nowadays, the figure is only one third, and when we talk to small and medium-sized builders about the problems they face, they mention two things: the difficulty of getting access to land and the difficulty in obtaining finance. Something needs to be done about both.

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[Mark Pawsey (Rugby) (Con)]

It is entirely right that we should debate the serious issue of housing this afternoon, but I am afraid that the Opposition have picked the wrong time to table a motion with such wording, as it does not reflect the state of the market, which is decidedly upbeat. However, those words might have been appropriate in 2010, when under Labour house building fell to its lowest level for nearly 100 years and Labour was consistently breaking promises on what it would do regarding housing.

I took the trouble to read the 2007 conference speech made by the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown)—his first speech after becoming Prime Minister—in which he promised that Labour would provide 240,000 new homes a year. The following year, the figure for new homes was 115,000—the lowest since the 1920s. Labour said that it would build eco-homes, and it kicked off with five communities, which went up to 10. That was going to be the centrepiece of its housing policy, but none of the communities was ever built or developed. Labour presided over a period of regional spatial strategies, with a top-down “central Government know best” system, but that simply failed to push forward land for development.

The words in the motion are wrong, because things are starting to happen with housing. The Government’s policies have begun to bear fruit, and nationally nearly 400,000 new homes have been delivered since 2010, and starts are up by 23%. The improvement applies not only to owner occupation: 99,000 affordable homes have been delivered since 2011, which is halfway towards delivering the 170,000 homes that the Government seek to deliver by 2015.

The Government’s initiatives to encourage home ownership are working. The Help to Buy scheme, which was launched in April 2013, is allowing people to get started on the housing ladder. There were 5,000 sales in the first six months and 1,000 house builders are registered. The importance of small and medium-sized developers has already been mentioned, and some 90% of the developers registered under Help to Buy are small or medium-sized companies. There are now 11 lenders covering the scheme. We are also meeting the aspirations of those in the social housing sector who wish to buy their own home by invigorating the right to buy.

My constituency is in the middle of England, and it sits in the middle of many statistics. In 2010, the number of new builds in Rugby fell by 62%, which was inconsistent with the level across the country as a whole, but in 2012-13, housing starts in the constituency increased by 260% to their highest level since 2007-08. Included in those figures is the gateway development of Eden Park, which the Housing Minister visited last February, where three developers are building 1,400 new homes—and selling them as fast as they can build them. The positive attitude to development in my constituency is reflected by an application for 6,200 new homes that will come before the local authority’s planning committee tomorrow, so things are moving across the country, especially in my constituency.

What would have happened if Labour was in power? With regard to measures on land banking, we have heard about state confiscation. The Home Builders Federation, the industry’s trade body, has said that there is no incentive for land banking.

[Mr Marcus Jones]

Does my hon. Friend agree that the difference between his constituency and mine, where we have a Labour-run local authority, is that his local authority works with local people to deliver these things, rather than imposing things that people do not want?

[Mark Pawsey]

My local authority has a record of going out and consulting local people. It has brought together a local plan. We are living in a plan-led system, and those authorities that do not have a plan in place will experience difficulties, as I know is the case in my hon. Friend’s constituency.

Confiscating land is no way to solve the problem. House builders want to build houses and there are no incentives for sitting on land. The Opposition’s policy would result in fewer houses being built, because house building would become a risky business to invest in and fewer people would invest in house building companies. Developers supply what the market demands. There has not been demand in the market in recent years, but the steps that the Government have taken, such as Help to Buy, have reinvigorated demand.

Labour is also calling for new towns and garden cities, but its eco-towns did not work. A much better way of delivering houses is through sustainable urban extensions, such as those coming forward in constituencies like mine.