He announced that the government would set out further plans to accelerate the delivery of new homes later this autumn,
Planning permission was granted for more than 310,000 homes last year, up 10% on the year before - but Kwartend says 'further reform is needed'.
Plans include promoting the disposal of surplus public sector land by allowingdepartments greater flexibility to reinvest the proceeds of land sales over multiple years, which Kwarteng says will encourage the sale of more public land for housing.
He also announced plans to streamline planning regulations and make securing planning permission easier.
It was also confirmed that the government is in discussion with 38 local and mayoral combined authority areas in England including Tees Valley, South Yorkshire and West of England to set up Investment Zones in specific sites within their area. Each Investment Zone will offer tax cuts for businesses and liberalised planning rules to release more land for housing and commercial development.
The Chancellor of the Exchequer, Kwasi Kwarteng, said:
“Economic growth isn’t some academic term with no connection to the real world. It means more jobs, higher pay and more money to fund public services, like schools and the NHS.
“This will not happen overnight but the tax cuts and reforms I’ve announced today – the biggest package in generations – send a clear signal that growth is our priority.
“Cuts to stamp duty will get the housing market moving and support first-time buyers to put down roots. New Investment Zones will bring business investment and release land for new homes in communities across the country. And we’re accelerating new road, rail and energy projects by removing restrictions that have slowed down progress for too long.
“We want businesses to invest in the UK, we want the brightest and the best to work here and we want better living standards for everyone.”
Richard Pike, Phoebus Software’s chief sales and marketing officer, said:
“Although the Chancellor announced plans to release government land to allow for development across the country, which is great news for future supply, that does not make more properties available now. The lack of supply is already pushing prices up and now that there is added incentive to move or buy that situation is only likely to increase. As ever the housing market is caught in a catch-22. The good news is that housing is definitely on the government’s agenda and that is something we’ve been calling for, for a very long time.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says:
"The ambition to reduce planning red tape and improve delivery is particularly interesting because if there is one thing we need more than anything it is additional affordable housing to sell and to rent. Nothing is more frustrating than gaining planning permission for suitable schemes and then waiting sometimes more than a year for work to begin as often unnecessary regulation needs dealing with."
Ian Pickering, head of development funding at specialist lender, Together, commented: “Confident words were heard from the Chancellor this morning, during what is widely reported as one of the most economically critical times of our country. The commitment to drive growth and unburden developers from age-old planning restrictions and EU derived laws, will be much welcomed by developers, architects, and lenders across the UK. Recognising how cumbersome the UK planning systems is, this is a move in the right direction and the simplification of this process should go some way to ease supply and demand challenges currently faced. The scope and speed of this is unclear, and further clarity would benefit everybody.”
Garry White, chief investment commentator at Charles Stanley, added: “Relaxed planning rules and a cut in stamp duty initially boosted shares in housebuilders including Persimmon, Taylor Wimpey and Bellway. The sector has been lobbying for a simplified planning system for years – and reform plans include promoting the disposal of surplus public sector land as well as a streamlining of planning regulations to make securing planning permission easier. However, these gains evaporated quickly as global investors concluded that the Chancellor’s growth gamble was too risky – and the pound resumed its slide against the dollar.
“Planning reform is essential – the issue in the UK housing market is supply and not demand – the country is structurally short of new housing. However, boosting demand through incentives such as a reduction in stamp duty before reform of the planning system has started may be counterproductive. It may end up boosting house prices in a rising interest rate environment. This is good for current homeowners as the value of their asset rises – but may ultimately make owning a home move further out of reach for many trying to get onto the bottom rung of the housing ladder.”
