How to build houses
Some thanks are due the Chancellor. The 22 November budget was not anything like as terrible as my worst fears. No silly fiddly measures which create lots of silly red tape for small businesses and individual taxpayers, whilst producing minimal benefits to the economy.
But inevitably, given the pressure he was under politically, the headline measures on housebuilding was a mixture of smoke and mirrors. Here is a nice simple tip for the Chancellor – if you want more houses built, then just build them!
For £6 billion, you could build nearly 100,000 council and social houses in England. All he needed to do was release this level of funding to local councils and social housing companies, many of whom are absolutely crying out to build more houses but don’t have the funds. But wait, I hear you say, the country does not have a spare £6 billion to spare right now.
Wrong! The Chancellor set aside £3 billion on the unfolding Brexit mess, where due to the rabid Tory right it looks possible we might not even get the Northern Ireland situation right without having to throw a load of money at it. And then, of course, we found another £3 billion which was specifically directed at making the property situation worse.
Any first year economics A-level student will tell you that reducing a tax on something will result in the price of it going up. So the £3 billion we are going to spend on lower stamp duty can only result in higher house prices, and worse affordability for most people. Bonkers!
It really is this simple, Mr Hammond. If you genuinely want to build a lot more houses, just build them!
Tuesday 5 December 2017