THE HOUSING CHALLENGE

THE HOUSING CHALLENGE - ONE SOLUTION

The Coalition Government has made a brave start to try and increase the opportunity for new buyers to enter the House Owning Population by their 20% contribution towards the deposit to buy a new house. This is only the tip of the iceberg to solve the chronic shortage of new homes.

The Conservative and Labour Parties have promised to build 100,0000, 200,000 new homes in the future.

We need a more radical and futuristic approach to building new homes. So, what can new thinking embrace? Here is one proposition – I call it The Limited Period Building Incentive.

It will be for a limited period such as 2016 – 2019.

During this period, Builders – both Private and New Public Building Companies will pay no tax on the agree Profits that they make on new builds during this period.

Builders Profits will be defined as follows – Cost of Materials + Cost of Labour + Cost of Overheads + 50% Profit Margin. This is excluding any cost of Land. The Builder will make no profit on the cost of land.

Land will be sourced from Government owned land, County Council and Local Council Land or Brown sites and some Green Land – priced at a below market value rate – to be calculated by the Government.

VAT on Building Materials used by Builders during the LPBI will be 0% based.

The Government in conjunction with the County Councils and the Local Authorities would give Special Building Permits ( SBP ) to Builders. Auditors would check the individual accounts of Builders for the SBP sites.

There is one big problem remaining which we have to tackle. - Shortage of Manpower.

Here are some solutions -

• Special entry Immigrant Labour would be sourced – if no British Labour was available – my 3 months advertising for British Labour rule would apply. They would not qualify for benefits.
• The Government would create more Apprenticeships for Building Workers.
• The Able bodied unemployed would be offered work with Builders to continue to receive any benefits at all.
• Local Government Building Task forces could be employed in the private sector to help the New Build Programme.
• New fast build materials would be sourced to speed up the Building Process – remember Pre Fabricated Houses after World War 2 ?
• So, we need a new co-ordinated approach to the Manpower Problem.

There will be a Retail Price Cap on the new build houses of £125,000 at 2016 Prices modified by any Regional Differences. This will include Terraced Houses, Semi-Detached Houses and 2 Bedroom Apartments.

The resale price of these houses will be capped at original purchase price + 3% and can only be sold to people in the Classified Priority Groups. This will avoid people purchasing for capital gains reasons. – in other words these houses are not for the speculators !

This LPBI Policy should dramatically increase the supply of affordable homes.

However, there must be conditions such as-

The new LPBI Homes must be made available to – First Time Buyers and not speculators.

They must be available to British Citizens or Immigrants who are classified as Essential Workers such as Nurses, Doctors and the like.

Crazy? Well, at least it is innovative. We need some new thinking otherwise houses will remain too costly and we will still have a big housing shortage.

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