London needs more planning and tax powers to tackle the housing crisis

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Experts have recommended London should be given more power to control planning, tax, and spending to ease the housing crisis…

The London Housing Commission has called for greater powers to be given to the mayor of London and the city’s boroughs in a bid to tackle the shortage of housing.

The panel, which was led by the former civil service chief Lord Bob Kerslake and established by think tank IPPR, said measures should be enacted to double the annual supply of homes in London by 2020.

Currently, the capital is only delivering 25,000 new homes a year. This is half of what is needed to keep pace with London’s growing population. The capital must unlock enough land to develop 50,000 homes a year and ensure their planning departments can manage the extra workload.

The commission recommended there should be a major programme of public sector-led new housing to offset private developments.

Lord Kerslake said: “London is facing a housing crisis of unprecedented proportions brought about by a chronic under supply of new housing. It needs urgently to be building far more houses of all types and tenures.

“We are confident that the package of measures we have set out in our report would go a long way to solving London’s problems.

“While the mayor and the boroughs can do more with the powers that they have now, the only route to building substantially more homes in London is to give the capital’s leaders more direct responsibility over the key levers such as land use, planning rules, housing standards, property taxes and investment and holding them accountable for delivery.

“If nothing is done, both the scarcity and affordability of housing across London will continue to worsen. Levels of home ownership will continue to fall and rents will continue to rise.

“That will not only put extra strains on the lives of Londoners living in the capital, but will also have wider social and economic consequences.

“The next strategy for London housing requires two phases. First, there is a number of actions the mayor and the boroughs can take immediately to boost housing supply.

“Beyond that, there are a series of longer-term reforms, including devolving powers to the mayor and the boroughs, which would make further inroads into the housing crisis, and maintain the momentum behind the efforts of the mayor and boroughs.”

The commission recommended caps placed on the boroughs’ housing borrowing limits should be removed to allow investment in new properties. Additionally, it said local authorities should be allowed to retain a proportion of the money raised from stamp duty.

Boroughs should also be allowed to set their own licencing schemes for landlords, with the power to ban unscrupulous ones from renting out properties that are not of a high enough standard by 2025.

Developers could also face a tax if housebuilding targets have been missed, while local authorities would have the ability to set higher council tax premiums on empty and second homes.

A Government spokesman said: “Housing completions were up 35 per cent in London in 2015 and the capital is receiving £1.45 billion through the affordable homes programme.

“We have also announced we will help deliver at least 90,000 affordable home starts in London by 2021.

“Alongside that many innovative approaches to boost housing delivery have been developed by the Government and Greater London Authority including housing zones and build-to-rent schemes.

“We are also reforming stamp duty, which will help people into home ownership.”

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