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Call to shake-up housing policy

Housing developers should be allowed to offer "very substantial" cash incentives to win the support of residents for new construction projects in their neighbourhoods, a think-tank report suggested.

The Policy Exchange report said that decisions on new housing should be made by a ballot of affected residents, taking the decision out of the hands of council planners and preventing a vocal minority from blocking developments which are supported by the majority.

The proposal is one of a number of ideas designed to increase the supply of homes and stabilise property prices, to reverse a "housing crisis" which has led to swollen waiting lists for social homes and excluded many would-be first-time buyers from the market.

The think-tank said that its proposed overhaul of housing policy could save taxpayers around £20 billion a year, principally by bringing down the cost of Housing Benefit and making it easier for social tenants to find work.

The report called for the Government to adopt an official policy of stable prices for housing and take measures to prevent the kind of inflation seen in the last decade, with the goal of ensuring that all working families should be able to afford a decent home by 2030. Author Alex Morton also urged ministers to quadruple to 100,000 the number of new social homes built each year.

Rules for social home eligibility should be changed to prevent perverse incentives which make tenants dependent on benefits - for instance by making it difficult to move house to find work - he said.

By default, new social tenants should be put on a "path to ownership" route, with their rent treated as mortgage repayments on their homes.

House prices more than doubled between 1995 and 2009, taking the price of an average home in Britain in real terms from £72,659 to £160,000. But fewer new homes of any sort are being built, and many of those which are built are small flats regarded as "rabbit hutches" by potential residents.

Policy Exchange deputy director and editor of the report Natalie Evans said: "Not only does current housing policy not work, it is also extremely expensive. At a time when public finances are under such strain this is not sustainable. The reforms outlined in this report to social housing and the planning system would save up to £20 billion a year.

"At the same time, rising house prices are making it harder and harder for those who want to buy to do so. We need to get away from the idea that house prices can rise faster than inflation every year without that affecting the ability of people to actually buy."


From Belfast Telegraph