As Mortgage Strategy went to press on Friday, there was still no news on whether housing minister Brandon Lewis had kept his job or been replaced as part of Theresa May’s Cabinet reshuffle.
Now, we know that Gavin Barwell will replace Lewis in the role.
There are continuing calls for the role of housing minister to be made a Cabinet position but, with Brexit and international terrorism high on the new prime minister’s agenda, it may feel as though there are insufficient chairs around the table to give all these important issues the profile they deserve.
However, let us not underestimate the importance of housing. When the market is dysfunctional and property prices are unaffordable, this both initiates and aggravates social tensions. It results in disenfranchisement, instability, exclusion and inequality, exacerbating the gap between rich and poor. Indeed, pressure on housing is one of the reasons many people cited for voting in favour of Brexit.
Barwell will have a hefty stack of paperwork to get through in the early days of his new role, courtesy of the House of Lords Economic Affairs Committee. In a report last week, it called for housebuilding volumes to be almost doubled to 300,000 homes a year in order to solve the current crisis.
It also slammed the reliance on private housebuilders to deliver new homes, urging the Government to lift restrictions on local authorities and allow them to borrow money in order to fund development. The Lords have highlighted a fundamental flaw in the current system whereby big housebuilders’ business model restricts the volume of new homes to maximise their profit margin.
The committee wants local authorities to be permitted to charge council tax on unfinished developments after a set period, which could help to get some of those cranes and diggers moving more quickly on sites up and down the country.
The Lords were scathing about the Government’s move to tax landlords more heavily, warning it would make matters worse for tenants. They called for the higher stamp duty charges to be reversed or reduced.
Finally, the Lords suggest that a Cabinet minister be given specific responsibility and targets for freeing up public land that local authorities can use to develop more affordable homes.
The proposals are certainly food for thought and Barwell would do well to consider them closely.