Second homes under fire

PUBLISHED: 08:56 20 June 2006 | UPDATED: 11:03 22 October 2010


Ministers must find ways to crack down on the second-homes market to ensure that people are buying properties to live in, according to a report published today.

Ministers must find ways to crack down on the second-homes market to ensure that people are buying properties to live in, according to a report published today.

The far-reaching report by a cross-party group of MPs warns that efforts to boost the supply of affordable housing will fail unless policies are in place to ensure the homes provided are made avail-able to those who need them most.

Last week, the EDP reported warnings that spiralling house prices could see many East Anglian villages becoming ghettoes for the rich, with nearly 6,000 new affordable homes needed to meet the shortfall.

Now, today's report by the MPs says: “There is a danger that if there is an increase in housing supply, a significant proportion of extra homes in some parts of the country will be taken up by second homes.

“We recommend that the government considers further proposals arising from the Rural Housing Commission to discourage the purchase of second homes and to ensure that the new homes are occupied by house-holds as their primary residence.”

Last night, North Norfolk MP Norman Lamb welcomed the report but said more concrete proposals were needed.

“We have to come up with practical solutions. We can all wring our hands at the problem but it is about finding practical mechanisms for dealing with it,” he said.

He added he favoured using the planning system in some shortage hotspots - such as north and west Norfolk and north Suffolk - to ensure there were affordable homes and also more mixed- tenure schemes to help create viable communities.

The MPs' 70-page study confirms fears previously highlighted by authorities including Norfolk County Council that existing house-building targets - which include 478,000 new homes in this region - are not being met.

But it says the government policy of boosting affordability by simply flooding the market with new homes is a blunt tool unlikely to achieve its aims, and that policies for more homes need to be tailored to local needs.

The report adds that ministers have failed to set out the full infrastructure costs for supplying the extra transport links, schools, health services and water supplies needed to cope with the likely increase in population, and the current funding earmarked for infrastructure to support the house-building programme is “insufficient”.

A greater proportion of new homes should be built to rent, it says, and councils should be encouraged to issue compulsory purchase orders to find alternative builders where developers have secured planning permission but are sitting on sites.

The MPs also say the existing availability of services should be a key factor in determining where new homes should be built.

“Existing house-building targets are not yet being achieved. There are a large number of sites which have been allocated for housing, some with outline planning permission. There is potential to increase the take-up of these sites,” the report says.

“If house-builders are holding on to sites which are ready for development, councils should be encouraged as a last resort to use their compulsory purchase order powers and to find an alternative developer.”

Sue Sida-Lockett, chairman of the East of England Regional Assembly, said the MPs' conclusions on infrastructure appeared to echo those of the region - that not enough money was forthcoming from ministers.

“We have had significant concerns about the infrastructure deficit,” she said. “We've built into the plan as much as we can on affordable homes and homes for rent, there's no doubt about that.”

The assembly will on Thursday receive the findings of a public inquiry into its plans for 478,000 new homes in the region.

Stewart Baseley, executive chairman of the Home Builders Federation, broadly welcomed the MPs' report, but warned that at current building levels, there would be a shortfall of 50,000 homes every year and affordability would continue to be an issue.

“Social rented housing is part of the solution, but affordability problems will remain if the demand for market housing is not adequately met,” he said. “There is a need for greater flexibility within the planning system as well as greater output so that home builders can more effectively cater to consumer demands and aspirations across the board.”

“Long-term, the industry wants to see a policy and regulatory framework for innovation that stimulates cost-efficient, consumer-friendly innovation. To forge further progress we will also need to take consumers with us.”

A spokesperson for Department of communities and local government said: “The Select Committee is right that we need more homes for the next generation and that means new market housing, shared ownership and social housing too. That is why it is welcome that 50 local authorities are bidding to become new growth points involving new jobs, new homes and significant infrastructure investment too.”

Norwich City Council will learn today if it has succeeded in a bid for a £40m share of government cash. The city is bidding for growth point status and the money could be used to help fund the proposed Norwich northern bypass, better public transport in the west of the city and the regeneration of the Anglia Square area.

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