Mortgages  

Advisers slate proposal to ditch Green Belt rules

Advisers slate proposal to ditch Green Belt rules

Financial advisers have slated comments from the Institute of Economic Affairs that proposed helping first-time buyers by allowing greater development on green field sites.

Martin Stewart, founder of London Money, dismissed the suggestion made by the right-wing think-tank that green belt development should be freed up for affordable house builds.

Mr Stewart said: "If I were fortunate enough to be considered a youth, I'd be offended that I was being told that destruction of nature was my only hope of gaining a foot on the housing ladder."

Article continues after advert

He was responding to comments made by Mark Littlewood, director general of the Institute of Economic Affairs (IEA), who said the only "meaningful" way to resolve the housing crisis and build the required number of new and affordable homes was to sweep away out-dated rules protecting the green belt.

Mr Stewart suggested there were other things the government could do, rather than remove important protections against building on green belt land. He suggested the government could:

  • Improve the planning application process.
  • Make compulsory the purchase of properties empty for more than five years.
  • Put a cap on the number of properties that can be owned.
  • Set up a government developer.
  • Fund more social housing.
  • Put stamp duty land tax on the sale, using the proceeds to build more houses. 

Mr Stewart added: "No one is purporting some Stalinist approach to property ownership but the government should be allowed to use all powers of legislation and taxation in order to make home ownership fairer and help declassify it as an investment.‏"

Tim Morris, IFA with Russell & Co Financial Advisers, agreed there would be fewer objections to building on brown belt, rather than green belt land, although he said he thought green-belt development would "become a necessity".

He said: "I do not have an issue with building on the brown belt. It can be expensive and drawn out, yet there would be less objections and therefore more likely to actually happen. I get annoyed with how long it takes us to get decisions approved - yet I understand why we have to protect certain interests.

"However, we need a sensible and pragmatic approach to development."

Moreover, Mr Morris said overall, perhaps the narrative should shift away from a focus on homeownership. He explained: "With regards to home ownership for the young, perhaps we need to change our national obsession towards home ownership.

"If it wasn’t drilled into them that owning a home is a vital step to adulthood, perhaps prices would naturally level out over time - making house prices more affordable in the long run.

"Plus, the younger generation will be the wealthiest of any in terms of inheriting property wealth. Arguably, this means they have less need to rush into the property ladder and take on such obscene amounts of debt - which many first-time buyers have to do."

Other advisers suggested alternative ways to improve the housing situation and ease house price growth to make ownership more affordable would be to curtail additional mortgage lending after 60 years old, encourage downsizing with incentives and to apply harder brakes to the buy-to-let market.