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London


Highlight keywords  |Print this articlePrint this article
From: The Socialist issue 973, 29 November 2017: Make the Tories history

Search site for keywords: Homes - Housing - Rents - Council - Tories - London - Budget

Tory housing policy: build zilch, hike prices

Housing demo, London, 13.3.16, photo James Ivens

Housing demo, London, 13.3.16, photo James Ivens   (Click to enlarge)

We say: cap private rents and build council homes now

Dave Carr, East London Socialist Party

In his recent Budget speech, Chancellor Philip Hammond - to the delight of bleating Tory MPs - announced a cut in stamp duty on house sales, and measures to build 300,000 new homes a year.

As is always the case with Tory headline claims, the devil is in the detail. Closer inspection shows Hammond's housing initiatives don't amount to a hill of beans.

They plan to abolish stamp duty for first-time buyers on properties costing up to 300,000. And there will be 0% tax on the first 300,000 on properties costing up to 500,000.

But this will not reverse the trend in rising housing costs and declining home ownership.

Firstly, it will have little impact on property hotspots like London and the South East. And by the way, only the very affluent could afford the deposit and mortgage required on a 500,000 house - the average price in London.

Secondly, according to the Office for Budget Responsibility, "the main gainers from the policy are people who already own property, not the first-time buyers themselves." The cut in duty goes straight on the house price. This is based on evidence from a similar scheme New Labour's Gordon Brown introduced after the 2008 financial crisis.

But what about Hammond's other master stroke - building 300,000 new homes a year by pumping in 44 billion of investment?

The headline 44 billion investment is mostly in the form of loans and guarantees. According to the Institute for Fiscal Studies, the actual amount of new money is only 1.5 billion.

Compare that to the 20 billion the Tories have ripped out from UK housing projects - the equivalent of 280,000 homes, according to a Labour estimate.

Moreover, the latest house building announcement doesn't promise much more than the existing 'Starter Homes Initiative' introduced by the Tories in 2014.

Scandalously, it was revealed two days before the Budget that under this scheme not a single house has been built! The only beneficiaries appear to be the big builders.

The simple truth is that the last time any government built 300,000 homes was when it did it itself. Councils could start right now by building council homes. Jeremy Corbyn should tell them to do so, and pledge to reimburse them when in power.






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