What a blasted relief to hear that the government is listening to the squeals of anguish about the visceral lack of new homes in the UK. We need a million of them and we barely build a 100,000.
The big house builders can get funding from either raising capital through the Stock Market, lending institutions or private equity or a mixture of all. This is ‘fine and dandy’ but the smaller niche developers are left high and dry. They are barely able to borrow 50-60% of the equity, with interest paid throughout the term, at an effective margin of 6-7%, when entry and exit fees are taken into consideration, and this is before any rise in interest rates.
Ignore all the protestations from commentators in Europe and beyond (the ‘Brussel Spouters’) Help-To-Buy occupies 0.5% of the market and that is inconsequential in the scheme of things and is certainly not, by itself, stoking up a housing boom, there are bigger factors at work here.
Reforms of the planning process – good morning and welcome, where have you been? This asinine planning procedure has been holding back the forward march of planning applications for too long now. Councillors are more concerned about their re-election prospects than they are about the efficiency of an application which is why no decisions were made before May of this year, due to local elections, and goodness knows what havoc that may have caused to developments.
Planning Officers set the most impossible conditions that are done under the auspices of conservation and ecology but we all know this is ‘hogwash’. A ‘root and branch’ reform of this process is desperately needed. You need to drive a coach and horses through this fiefdom and ignore the squeals of anguish.
All these points are well taken and designed to try and re-balance the housing shortage in both the Capital and the UK and it can’t come too soon.