Taxpayer friendly way to build 900,000 houses

The amiable and ambitious Conservative leader of Hammersmith and Fulham Council has come up with a good idea. Stephen Greenhalgh has figured a way to raise £125 billion to spend on public housing and build 900,000 new homes over 10 years without it costing the taxpayer an extra penny.

There is of course a major catch: it would mean abolishing the Homes and Communities Agency super-quango just established by Labour. They won’t like that. But on the basis that the Conservatives might be running things next year, it is worth taking a look at the Greenhalgh plans. They are explained in a 74-page pamphlet published by think tank Localis this week.

Here is a (very rough) guide: First you raise the subsidised rents of Britain’s four million council and social housing tenants from the average of £100 a week to as close as you dare to £130 a week – the average private sector rent. To prevent riots, the extra £30 is handed back in the form of housing benefit to tenants.

That will cost £5 billion – which comes from commandeering the budget of the abolished Homes and Communities Agency.

Over 10 years this adds up to

£50 billion flowing into the coffers of local authorities and housing associations.

That will allow them to borrow an extra £75 billion over 10 years – enough to build half a million new homes.

The other 400 000 new homes come from selling off homes to tenants who will be given a “buy one get one free” equity offer – pay 25% for your home and get another 25% free. What do you reckon Mr Cameron?

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