Forman & Son MD Lance Forman on the positive effects of building more homes
- Credit: Archant
Hurrah. Dave – the builder – Cameron has announced that one million new homes are to be built in the UK in the next five years. How he plans to do this, I do not know, as the building trade is reportedly short on skills.
But that’s not the only shortage; we have a massive housing shortage in the UK and building new homes provides so many benefits. Indeed, I suspect we could do with two rather than one million right now, but you have to start somewhere.
As well as the obvious benefits of employment in the construction and related industries which will result directly from the new housing, the principal benefit will be that extra supply will bring down the cost of living. And it’s that cost which we need to bring down to make Britain competitive in a global environment. The chancellor recently set in place a measure to increase wages to deal with the high cost of living, but it’s not wages which need to rise, it’s the cost of living which needs to fall. Extra housing will make a difference and help to remove the angst that has built up over immigration and the recent refugee crisis. We simply do need more homes.
My worry is that the planning system will not allow it to happen. Just look at the problems over Heathrow. More than a decade of indecision as to where one new runway can be built. Nowhere is perfect and each location has pluses and minuses, but the biggest minus is doing nothing. We just need to get on and make a choice. As problems arise, we will deal them at the time, but at least we will be moving forward not standing still, which is the same as going backwards.
Politicians often blame landowners for holding land and not developing it, but the fact is that uncertainty in the planning system is a huge risk for developers and together with development taxes there is often little incentive to develop. Developers need to profit from their risk taking and investment. A long term increase in housing stock will mean that land values will fall which is the best incentive to get developers to build. More from Lance