Jeremy Corbyn revealed in his keynote speech yesterday some interesting headline grabbling policies for the future.
I didn’t listen to all 75 minutes but three things caught my eye;
- pledging to bring controlled rents back to the private sector
- a threat to use Compulsory Purchase Powers on developers for undeveloped land (‘use it or lose it’ as the headline says)
- tax unused land
I tend to shy away from politics here – but these proposed policies deserve some comment.
As always the devil will be in the detail. It may be that the generic term ‘rent control’ is not really that – it is probably a control of increases. Prior to 1989 we were subject to rent control – laughably known as ‘fair rents’ which were fixed by reference to the Rent Act 1977. By 1988 it was evident that such controls were strangling the supply of private rented property. The legislation had all but killed investment. We are just getting that stock back – of higher quality and more choice.
Compulsory Purchase is generally seen as a method of last resort. In Nottingham there are still CPO claims outstanding for land taken for the tram extension – which opened over 2 years ago and land was taken considerably before that. It is a painful process. Who will buy it – Local Authorities? At what price – market value? Good luck with that.
And then taxing unused land? In my experience developers hold land whilst actively seeking occupiers or buyers. The age of land banking is a hark back to different times – yes there is some, but not at the levels we saw 15 years ago.
It looks to me that these are great headline grabs – but delivery may be harder and have unwanted consequences. Developer and investor bashing may be politically acceptable but I’m not sure who else is going to deliver this stock – at the levels we need?