Plans for public land sell-offs for housing development

tartanterra

QUOTE: Developers' deal
"The Public Expenditure Committee, chaired by Cabinet Office Minister Francis Maude, will trawl government departments to identify more suitable land.
The Department for Communities and Local Government (DCLG) said Whitehall property specialists would work with each department to try to release as much land as possible."

"Local councils will also be encouraged to make their unused land available for development.
The DCLG has outlined a "build now, pay later" deal, through which developers pay for the land only once building work has started."

"The Town and Country Planning Association estimated government and council land was worth about £10bn, and raised concern it would be sold to the highest bidder rather than to developers who could deliver a large amount of high-quality social housing."

http://www.bbc.co.uk/news/uk-politics-13684111

This looks like a "might or might not happen" type scenario.

Whilst some of it looks positive -(36 hectares of land released in the centre of Bath!)- , I think that a target of 100,000 homes seems overambitious.
Also, I think developers will develop these sites due to the financial incentives and the fact that much of it will be premium sites, but continue to sit on their own land banks until building becomes more financially viable.

Further to that, I can't see cash strapped councils allowing their land to be sold for a song, which will have a knock on effect to affordability.

Really2

I see a problem

"The DCLG has outlined a "build now, pay later" deal, through which developers pay for the land only once building work has started.""

So can sit on it until it is worth more than agreed without any debts to cover for it.

tartanterra

Really2 wrote: »

I see a problem

"The DCLG has outlined a "build now, pay later" deal, through which developers pay for the land only once building work has started.""

So can sit on it until it is worth more than agreed without any debts to cover for it.

Exactly.

It actually looks like a scheme to help builders profitability and cashflow rather than a solution to the housing shortage.

Really2

tartanterra wrote: »

Exactly.

It actually looks like a scheme to help builders profitability and cashflow rather than a solution to the housing shortage.

And it would they could build on their current land banks paying off their debts knowing they have a nice stock of land they owe no money on until they need to use it.

If this goes ahead I think I might get some building shares, their cash flows will be transformed.

tartanterra

Really2 wrote: »

And it would they could build on their current land banks paying off their debts knowing they have a nice stock of land they owe no money on until they need to use it.

If this goes ahead I think I might get some building shares, their cash flows will be transformed.

It's ironic that this is being promoted by the "Department for Communities and Local Government", when the only people that seem to be doing well out of this will be multinational companies.

There is no guarantee of cheaper housing, and as any of your local tradesman will tell you, most of them will not bid to sub-contract for the national building companies as the money on offer is derisory.

All in all, it makes good headlines, but as ever the devil is in the detail.

lemonjelly

tartanterra wrote: »

Exactly.

It actually looks like a scheme to help builders profitability and cashflow rather than a solution to the housing shortage.

No! That is far too cynical for it to be possibly true...:cool: