Lisa Nandy, shadow levelling up secretary, is reportedly planning to reform how land is valued when acquired by local authorities through compulsory purchase orders (CPOs), according to The Financial Times.
Party sources told the newspaper that, if elected, Labour would pass a law to allow local authorities in England to buy land at below market value to develop new housing.
Under the law, likely to be introduced through an amendment to the Levelling Up and Regeneration Bill, local officials would be able to purchase land for developments without needing to factor in “hope value” – the price premium granted to land where developers hope to secure planning permission.
Will Jeffwitz, head of policy at the National Housing Federation, said the proposal “could help divert landowner profits into desperately needed new social housing and community infrastructure”.
He added: “Crucially, the effect would bring down land values across the market, making it easier for social landlords to buy and develop new social housing. We require daring and innovative housing policy that will enable social landlords to build the affordable homes people across the country desperately need.”
Brain Berry, chief executive of the Federation of Master Builders, claimed any policy to “make it easier to purchase land” would be a positive step.
”The biggest issue holding back small housebuilders is the ability to find available and viable land,” he said. “We would advocate that any developments unlocked through this proposed reform use a diverse range of housebuilders, from small to large, to maximise the opportunity for all sections of the industry.”
However, Rico Wojtulewicz, head of housing and policy at the National Federation of Builders, said he was “sceptical that any government or party will push forward through a coherent land use policy”.
He added: “This is a land usage issue not a land price issue. Labour, as a central government, would have to ensure local authorities were delivering the housing local areas need, as well as local infrastructure needs.”
Ian Fletcher, director of policy at the British Property Federation, said: “The development process generates significant value and income to the surrounding area; we would much rather see a collaborative process that encourages landowners to co-invest their land with public authorities, in return for long-term sharing of value.
“Proposals to scrap hope value within the CPO process is likely to lead to protracted legal challenges and increase the risk of regeneration schemes being delayed or not progressing. For any incoming government, such a policy is unlikely to deliver much new housing in its first five years.”
Source: Property Week