Berkeley has called for “strong political leadership” on housebuilding from potential Prime Minister Andy Burnham as it warned that London is on course to miss its housing targets.
The capital’s biggest housebuilder issued a swathe of demands to policymakers, warning that there is “no prospect of material improvement” on housebuilding “without more decisive intervention” from government.
The FTSE 250 firm warned that London is delivering less than 10 per cent of its annual government housebuilding target.
It now takes eight years to complete an apartment building in the capital, the firm said, compared to five a decade ago.
Rob Perrins, executive chairman of London’s largest housebuilder, warned that policymakers must go further, urging the government to slash stamp duty for new homes to three per cent, and to zero for first-time buyers.
“The excessive tax burden, that was introduced in a different economic paradigm, must be reduced to unlock demand and attract the essential investment without which regeneration schemes cannot proceed,” Mr Perrins added.
The housebuilder claimed that, if implemented, these demands will mean that London will meet its housebuilding target, tax revenues will jump and GDP will grow by one per cent.
Berkeley’s intervention comes days after Sir Keir Starmer resigned as prime minister, with outgoing Mayor of Greater Manchester Andy Burnham poised to take the keys to Number 10.
Mr Burnham is expected to launch a shake-up of housebuilding policy in a bid to boost social housing.
Analysts at Panmure Liberum warned on Tuesday that a possible redrawing of the Affordable Homes grant programme could delay payments and “push back the delivery of social and affordable housing units”.
The boss of Berkeley Group has warned that there is “no prospect” of reviving London’s flagging housebuilding market unless the government takes urgent action.
Mr Perrins said “decisive intervention” in the form of tax cuts and the removal of regulatory burdens is needed to boost building and demand, “as it is clear that policy changes to date are not feeding through to delivery”.
He blamed structural supply and demand headwinds for resulting in London delivering less than 10 per cent of the homes it needs.
Housebuilding has fallen in the city with just 5,547 new private residential homes started last year, according to figures from Molior, the residential development consultancy. That marks an 84 per cent drop from a decade earlier and way off the 88,000 new flats and houses the government is targeting every year.
Last month, Berkeley warned that developers can on longer invest in the capital after Southwark council’s planning committee rejected Berkeley’s application to build more than 900 homes on the site of the Aylesham shopping centre in Peckham for a second time.
“Every part of the system needs to work to reduce the time taken to get buildings into development and allow homebuilders to make a return commensurate with the risk that can attract the necessary investment capital,” he said.
Mr Perrins said “excessive” stamp duty on house purchases was the key reason curbing demand from prospective buyers, which he said must be cut to attract buyers and draw in investment.
He is calling on stamp duty to be cut to 3 per cent on all new homes and the removal of stamp duty surcharges, which “deter vital investment in new-build homes”.
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