UK Government Unveils Bold Plan to Tackle Housing Crisis
In an effort to tackle the “crisis of home ownership” in the UK property market, the Chancellor of the Exchequer George Osborne has pledged 7billion to tackle the chronic shortage of homes. The Chancellor has been quoted as saying:
‘And I am clear: in this Spending Review, we choose housing. Above all, we choose homes that people can buy. For there is a crisis of home ownership in our country.”
Addressing Parliament Mr Osborne said their aim is to create 400,000 new homes across the UK. In this ambitious move the Chancellor outlined a number of major initiatives to help tackle the UK housing crisis. Their new proposed Housebuilding programme is being labelled as the ‘biggest since the 1970s’.
The Governments mains pledges included:
- 200,000 homes to be built for first-time buyers under the Starter Home Initiative by 2020.
- Doubling the housing budget to £2bn per year.
- 135,000 new homes to be built under a new Help to Buy Shared Ownership scheme.
- 10,000 new homes which tenants can live in for five years at reduced rents while saving for a deposit.
- To introduce a Help to Buy London scheme to grant equity loans of up to 40% to buyers of new homes in the capital.
- £400M will go towards creating 8,000 homes built with the elderly and disabled in mind.
- Stamp duty to rise 3% for buy-to-let homes.
- £4bn going to housing associations, local authorities and private sector.
The Chancellor’s ambitious aim here is essentially to boost home ownership in the face of soaring numbers of private landlords, and to generally work to curb the rate at which house prices are going up. However critics of this bold move have questioned whether these new policies will work for people on low incomes.
Also this housing plan should not be seen as a silver bullet that will solve the housing crisis as the Government still needs to further reform the planning system to ensure enough land is released for development.
Criticising the Chancellor’s new housing plans, shadow housing minister John Healey said
“If hot air built homes, then Conservative ministers would have our housing crisis sorted.”
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