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Industry must push politicians on housing

As housebuilders report soaring profits but the volume of homes built continues to fall well short of demand, the public start to ask questions. Politicians need to answer them.

Last week Barratt, Bovis, Persimmon, Redrow and Taylor Wimpey reported profits had risen by almost 50 per cent - considerably more in some cases.

With Help to Buy proving hugely popular with homebuyers - supporting the purchase of around 15,000 homes so far - but house prices continuing to rise rapidly, the public’s first question is whether Help to Buy is helping builders more than buyers.

The second question is what is going to replace it. Having become arguably the best known home ownership policy since Margaret Thatcher’s Right to Buy, the huge take-up of Help to Buy means the pot of money set aside to fund it is now expected to run out next year - a year earlier than the Treasury intended.

Budgetary potential

George Osborne will have the opportunity to answer these questions during his Budget speech on 19 March.

“How can we create the conditions to build enough homes to meet demand and, as a result, increase affordability?”

We are likely to hear about not only the people that have been helped to access mortgages, but the jobs that have been created as their homes are being built. Barratt, for example, emphasised its expansion in training and apprenticeships.

But the biggest questions are likely to remain: as a nation, how can we create the conditions to build enough homes to meet demand and, as a result, increase affordability?

The major housebuilders have increased the volume of homes they are building at the fastest rate in years - but they are not planning a rush to return to pre-downturn levels of building.

And why should they? They have shareholders, a profit motive and every right to manage their own growth.

Housing electioneering

This week London mayor Boris Johnson made it clear to an audience of construction and property professionals at a Movers and Shakers breakfast in London that increasing housing in the capital was his top priority.

Exactly how he is going to do that is less clear, although he did say traditional high streets had had their day and should be part-converted to residential. He also said he might consider freeing up strategic industrial locations for housing.

As we approach the general election, we need politicians at both national and local level to outline three things: the extent to which public sector housing will be increased (the UK has never seen major levels of housebuilding without it), how this will be funded and facilitated, and their policies to boost the private rented sector.

Contractors should play a part in all three.

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