Wednesday 25 May 2016 12.05pm
A level playing field has to be created, or else the current situation will continue. With land values so high, of course every developer will use all the experts and methods they reasonably can to minimise their liabilities and maximise profits. Shareholder owned companies have a duty to their shareholders to do just that, and local authorities are required to operate under principles of 'best value'. In London right now local authorities own large amounts of land with little or no development on but are trying to increase its value in legitimate ways like planning permissions. They have nothing to lose by leaving some land empty or rented out, and everything to gain, because we do not tax land in this country.
Is there agreement about what the problem is? Is it foreign ownership, or cash buyers, or the mere presence of luxury new properties? Each of those things are legitimate objections in a world city.
The 50pc affordable housing policies of Livingstone and Prescott provided a goal and showed what they thought success would look like - a city where half the new housing stock (which itself is a tiny proportion of the overall stock) is affordable - but they didn't work out as intended. Today they've both trotted out cute excuses for why they allowed the St George Wharf tower - one "hoped" it would be for locals and the other "didn't know" it would be bought mainly by investors. And they point out that planning cannot regulate who lives somewhere, just as it cannot say that Joe Blogg's Café can open up but Starbucks
A revolution in planning and land laws seems about as likely as a new electoral system or a written constitution. But land value taxation as mentioned above as used in many well planned and rich countries - Denmark, Hong Kong, Singapore for example - could ensure that land does not sit empty; that land is not simply 'flipped' on gaining planning permission (witness how Battersea Power Station's "value" has been jacked up over decades by a series of sale>planning permission>resale processes).
The possibility of compulsory purchase of largely unoccupied properties was suggested today in the Guardian by Livingstone and might work within existing legislation if there was a (substantial) public interest - though it is a drastic interference in individuals' rights.
Or if we are saying that the current model is not delivering enough affordable housing then massive, public sector led affordable housing delivery would seem to be the only option left. This would work if they had the right to buy land at its unimproved rate (like the New Towns bought land at agricultural prices) but might take a long time to deliver and risks creating the sort of monotonous built environment that we now regret being built in the 60s and 70s. Development corporations could speed up delivery perhaps and powers to create these already exist.