Housebuilders Warn Against ‘Wild’ Target For New Homes

/ 30 September 2013

Myfanwy Neville

‘Housebuilders have warned the Labour leader Ed Miliband that his “wild” plan to build 200,000 homes a year is not physically possible.

It comes after the country’s largest housebuilders met with George Osborne last month to try to temper expectations that supply could be quickly increased. During the discussions, developers warned that production could be stepped up only by between 5 and 10% a year – someway short of the 20% needed to reach Mr Miliband’s target.

Charles Fairhurst, chief executive of Fairbridge Residential, suggested that politicians were once again failing to understand how “real” markets worked.

“The bigger issue about Labour’s wish to increase new build levels to 200,000 per annum is the already serious lack of construction staff.” One unnamed executive at a housebuilder added: “The 200,000 homes per year is a sound bite. If ‘Labour’ get in, they will turn around and say ‘the industry has let us down by not delivering’. It’s a wild target”.

An editorial in the Telegraph remarks that Labour’s housing policy is “incoherent and statist”. The piece remarks that Mr Miliband’s policy will let bureaucrats determine what must be built and where, adding that if businesses do not go along with Labour’s ideas, they will be hectored – or punished – until they comply.’

Source: Financial Times    

Myfanwy Neville

Partner: Property and Construction, Sustainability and ESG

T +44 (0)20 8922 9376
E Myfanwy.Neville@bkl.co.uk

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