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The market is broken: high cost of land denying people homes

17 June 2019

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Alongside Shelter and CPRE, 10 of the country’s top housing experts have come together today to push for urgent reform to the 1961 Land Compensation Act.

In a system where the value of almost every scrap of land is maximised to deliver the highest possible return for the landowner, the losers are communities left with unaffordable, poor quality homes in the wrong places.

Grounds for Change: the case for land reform in modern England is a collection of essays by thought-leaders from across the housing sector. Its publication marks the start of a campaign to advocate for a fairer way of trading land in order to unlock England’s land market and build the homes the country needs.   

Brought together by the housing and homelessness charity, contributors include Crispin Truman, chief executive of the Campaign to Protect Rural England (CPRE); Clive Betts, chair of the Housing, Communities and Local Government Select Committee; Nicolas Boys Smith, founder of Create Streets (and recently-announced interim chair of the government’s Building Better, Building Beautiful commission); and Will Tanner, director of the think tank Onward.  

The housing sector’s call for legislative change is backed up by evidence from a new Shelter survey of chief council planners in England, which shows the cost of land is the biggest barrier to council housebuilding. Two-thirds of respondents said it prevents them building more social or affordable homes.

And, since 1995, the value of land has risen by 544 per cent. Compare that to consumer prices – which increased by just 50 per cent in the same period.

Polly Neate, chief executive at Shelter, said: “Land is central to building homes – and high land prices have very real consequences for people and communities.

'If we want to build high-quality social or private homes in this country, we need reasonably priced land to do it. Yet under our current system, agricultural land becomes 120 times more expensive simply from receiving residential planning permission4 – and outdated legislation compounds the problem. 

'That’s why Shelter has brought together a coalition of housing’s leading minds to answer one simple question – how many and what kind of homes could we build if the cost of land was no longer a barrier?'

Crispin Truman, CPRE chief executive said: “Our broken land market means that developments are increasingly sited where there is the greatest profit to be made, rather than in the most sensible and sustainable locations.

'Yes, we need to build more. But if we are to lose precious countryside, let it be to well-planned developments, where the profits from rising land values are invested in public green spaces, walking and cycling infrastructure, community facilities, and well-designed homes that people can afford to live in, rather than accruing primarily to landowners.'

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