Marcus Jones
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The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones)
It is, as always, a pleasure to serve under your chairmanship, Sir David. I congratulate the hon. Member for Brentford and Isleworth (Ruth Cadbury) on securing this debate on the important issue of affordable housing in London. I can assure her that this is a top priority for this Department and this Government. In the short time that I have today, I will endeavour to respond to the points made by hon. Members.
The demand for affordable housing in London is without doubt challenging. It is clear that the new Mayor has a significant task ahead of him to meet the needs of the growing population in such an important world city. A number of hon. Members asked whether we would work with him, and we certainly look forward to doing so. We all share the same ambitions—to build more homes in London and to help more people to own their own home.
We have a good track record. Since 2010, we have delivered more than 710,000 homes, including 277,000 affordable homes—67,000 in London. Our affordable homes programme delivered 193,000 affordable homes between 2011 and 2015. Last year was a record year for London. We delivered 27,000 homes, including 18,000 affordable homes—the most since records began in 1991. We were the first Government since the 1980s to finish with more affordable homes than when we started. Since 2010, we have helped 290,000 households to become homeowners, thanks to schemes such as Help to Buy and right to buy. However, even though we have delivered a record number of homes in London, there is without doubt more work to be done.
Mr Jones
I will make some progress before giving way, because I am short of time.
Only one third of new homes in London were delivered through the open market. With London’s housing challenges, the market needs to do more, and the Government are certainly doing more. We are focusing on three things—streamlining the planning system, helping Londoners into home ownership and ensuring that housing stock is managed fairly and effectively.
We are introducing further reforms. The Housing and Planning Act 2016 gives house builders and decision makers the tools and confidence to deliver more homes and streamline the planning system to accelerate delivery. Planning permission in principle will provide greater certainty, and registers of brownfield land will make it easier to identify suitable sites, which are at a premium in London.
However, the reforms need to be implemented effectively in every area. We need to see more homes that are planned for actually being built. We have consulted on a new delivery test that drives action where build rates are below expectation. We have been working with the major house builders on how they can be clearer about their delivery plans, and I welcome the statement of intent published by the Home Builders Federation just last month.
We are doubling the housing budget to more than £20 billion to deliver 1 million more homes by the end of this Parliament. That includes £8 billion for 400,000 affordable housing starts, including 100,000 affordable homes for rent. That is the largest affordable housing programme by any Government since the 1970s.
We know that 86% of people want to buy their own home, and we certainly support their aspirations. That is why our programme to support home ownership is so important. With shared ownership, London’s first-time buyers will be able to get on the ladder with a far smaller deposit: £3,500 will secure a 25% stake in a property. Our new London Help to Buy scheme increases the equity loan available from 20% to 40%, and our help to buy ISAs are helping people to save up a deposit for their first home. Our voluntary right to buy gives 1.3 million housing association tenants the chance to buy their homes.
We will build 200,000 starter homes so that young first-time buyers will be able to buy their first home with a minimum discount of 20%. Legislation will place a duty on planning authorities to embed starter homes in the planning system. That will be supported by £1.2 billion of funding to unlock brownfield land. For high-value areas, the Housing and Planning Act allows for off-site commuted sums for delivery elsewhere. We are consulting on the details of how that will work.
We need to make better use of the existing housing stock. The market value of council housing stock in April 2014 was more than £200 billion. By selling councils’ higher-value housing as it falls vacant, we can release the locked-up value to build more homes and fund the right-to-buy discount for housing association tenants; and we will absolutely ensure that for every council house sold in London, at least two affordable homes will be built.
Meg Hillier
It is all very interesting to hear what the Government are planning nationally, but this debate is about housing in London. On the issue of the sale of high-value council properties, there are properties in my constituency that will have to be sold under the current Government proposals. The hon. Member for Torbay (Kevin Foster) has no council housing in his constituency, because it was transferred, so homes will be sold in Hackney to pay for people to buy their homes in Devon potentially, unless the Minister is able to commit now to ensuring that there is at least a ring-fencing of the money from the sale of council homes for right to buy, so that it stays within the M25.
Mr Jones
As the hon. Lady will know, we are working up the plan for higher-value social homes that will be sold. At the moment, it has not been made clear which properties will need to be sold, but certainly they will only be properties that are vacant; and just to reassure her, we are absolutely clear that for every house that is sold in London, at least two affordable homes will be built.
Mr Jones
I need to make more progress because I am very short of time.
We have helped to unlock major regeneration sites in London and we are investing £600 million to create 31 new housing zones in London, which will deliver 77,000 new homes by 2026. In the last Parliament, we released public sector land with capacity for 109,000 homes. We will release more land, and at least 160,000 homes will be built. The London Land Commission will continue to be an important way of engaging with the public sector to release more land for housing.
In the short time that I have left, I will pick up a few of the points that hon. Members raised. First, there was an assertion that people buying starter homes would need a minimum salary of £90,000. I am sure that many hon. Members will have seen that Shelter has done research on that, based on 2016 housing values. It came to the conclusion that people would be able to buy on salaries of £45,000 and it predicted that 30% of the people in London who are currently in private rented accommodation would be able to buy a starter home on that basis.
Another assertion was about the supply of homes. I find it difficult to comprehend that so many Opposition Members are criticising this Government’s action on providing affordable housing when, between 1997 and 2010, 420,000 affordable houses were lost from the system. I can assure hon. Members that this Government are absolutely committed to bringing forward new affordable housing. We are introducing an £8 billion programme to deliver 400,000 more affordable houses; 135,000 of those will be for shared ownership—that was a concern raised during the debate—and 100,000 of them will be affordable homes for rent.
Let me settle some concerns about the right to buy in London. Since the reinvigorated right to buy was introduced by my party as the lead party in the coalition during the last Parliament, in London, where right-to-buy housing sales have been made, on average roughly two additional homes have replaced that stock. I am getting a polite stare from you, Sir David, so I will conclude now for the mover of the motion.