Is the ‘broken house market’ about to be fixed?

The Government has pledged to fix the “broken housing market” as plans to build more affordable housing were unveiled in its new housing white paper.

The long-awaited white paper includes measures to reduce obstacles that prevent developers building on land as well as improve affordability and protections for renters and home buyers. Greater transparency and information from developers on their pace of delivery of new housing will help address the growing gap between the number of planning permissions granted and new homes completed.

Local planning authorities must produce a plan for housing growth and review it at least every five years to ensure enough land is released for new homes to be built. Currently 40% of local planning authorities do not have an up-to-date plan that meets the projected growth in households in their area. They will also have to increase the density of new homes in cities and build upwards where there is a shortage of land. There will be a £3 billion home building fund to help independent builders enter the market as 60% of new homes are currently built by just 10 companies. It will be used to build more than 25,000 new homes by 2020 and up to 225,000 in the long term by providing loans for small firms and custom builders. From April, the Government will introduce a Lifetime ISA to help young adults save for a deposit with a 25% bonus on up to £4,000 of savings a year and there are plans to extend Right to Buy to housing association tenants.

The Government aims to tackle the high cost of renting by amending planning rules so councils can plan for long-term Build to Rent homes and a consultation has been launched to allow developers to offer more affordable rents.