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Right to Build

The Conservaties want to help the have-nots into the property market, says Shadow housing minister Michael Gove

Labour has accused David Cameron of “recycling a failed Tory policy” with his proposal to introduce rent-to- buy on social housing, saying only 400 people took up the rent-for-mortgage scheme in the 11 years the scheme existed. How would you ensure take-up if the policy was implemented? Is there a role for the mortgage industry?

Gove:

Given the increase in house prices in recent years and the record low numbers of first- time buyers, people increas- ingly need help.
The Conservatives are committed to extending shared-ownership schemes to bridge the divide between the haves and have-nots by helping those who aspire to own their homes but who are financially are unable to do so on their own.

At the moment, shared- ownership schemes are too restrictive, which has led to thousands of empty homes across the South-east. The mortgage industry has an important role to play in this and Caroline Spelman, MP, Shadow Secretary of State for Communities & Local Government, recently invited the Council of Mortgage Lenders to help us to devise ways to increase shared- ownership opportunities for the “have nots” of our society.

When the right-to-buy prop- osal was announced in August it came in for criticism from a number of sources, including the housing charity Shelter, which warned that the right-to- buy policy would exacerbate the housing situation by limiting the supply of social housing. How do you respond to those criticisms?

Gove:

David Cameron made clear in his August speech that our policy would lead to more social housing being built.

Capital receipts of sales would be reinvested in housing instead of being put to other uses, as is now the case.
However, let us be clear, the housing crisis is not down to right to buy, it is down to the Government massively underestimating the amount of new social housing that is needed.

The building rate of social housing under this Government is lower than it was under the Conservatives and Shelter recognised this “failure to build” in its response to David Cameron’s announcement.

Can you elaborate on the other measures the Conservative party is proposing to streamline the housebuying process in general?

Gove:

We are looking at Scotland and other countries for lessons to give buyers and sellers more certainty.

We do not think that home information packs are the answer. Instead, we want to promote e-conveyancing and greater use of the National Information Land Service by local authorities to speed up the homebuying process.

The details of this, as well as additional measures, are currently being considered by our public services policy group.

You say that Hips are not the answer, what are your key concerns about this initiative? How would the Conservatives help first-time buyers?

Gove:

Labour has built many road blocks to ownership, including restricting the right to buy, ramping up stamp duty and driving up council tax.

The introduction of Hips, as well as plans for a property development tax, would only serve to exacerbate the situation. It is the Conservatives who are leading efforts to break down these barriers.

We would help first-time buyers by opening up shared-ownership opportunities which have been closed to all but a few sections of society.

Most important, we would increase housing supply to stabilise house prices – the biggest barrier to homeownership.

Following our pressure, the Government has removed the home condition report requirement from their plans for Hips, leaving the energy performance certificate as the principle remaining element. Without the HCR, we fear that there will not be enough home inspectors to make the Hip viable. We will continue to call for the project to be rethought entirely.

You make the point about stamp duty being a “roadblock to ownership”. There has been no upward revision of the higher thresholds of £250,000 and £500,000, penalising customers in those price brackets. How does your party intend to tackle the issue?

Gove:

The Conservatives have been highly critical of the Chancellor’s approach to stamp duty. Gordon Brown has tapped into rising house prices by refusing to increase the threshold at which it is paid, so more middle-income families now find themselves liable for thousands of pounds worth of taxes.

The Council of Mortgage Lenders recently stated the proportion of first-time buyers paying stamp duty has leapt from 48 per cent to 56 per cent in the space of just a year.
Shadow Chancellor George Osborne has set up a tax Reform Commission to look into much-needed reform of the tax system, with the aim of making it simpler, fairer and flatter and stamp duty is a crucial part of its remit.

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