Rishi Sunak promises ‘land banking’ crackdown to boost new housing
Developers who buy up tracts of land and sit on it for years without building any new houses would be hit with big council tax bills under plans announced by Rishi Sunak on Thursday night.
The former chancellor vowed to look at a new levy to punish companies that engage in “land banking” as part of a three-point plan to boost the number of homes being built.
Mr Sunak has pledged to ease Britain’s housing crisis by forcing firms to speed up building on sites on which they have been granted planning permission to develop.
Under the current rules, council tax is only charged once a new home has been completed – meaning builders are not financially punished for sitting on land for years or even decades.
Developers are hoarding plots that would accommodate 441,000 new homes, according to analysis published by StripeHomes, a property company, last summer.
A separate study by the Local Government Association in 2020 estimated that more than one million properties with planning permission had not been built.
Mr Sunak has said he would also require developers to build on unused land before they were granted planning permission for any more plots in the same area.
He would introduce a beefed-up compulsory purchase order scheme allowing councils to buy land back at a discount if it was not developed within an agreed timeframe.
Separately the former chancellor has promised to bring in an “infrastructure levy” on companies, with the proceeds used to pay for new GP surgeries, schools and roads where homes are built.
“As Conservatives, we are the standard-bearers for capitalism because we know it is the only way to deliver a better tomorrow for our children and grandchildren,” Mr Sunak said. “But we can’t expect those future generations to share our belief in capitalism if they can’t get their hands on capital.
“That’s why I will do whatever it takes to build housing that is affordable and plentiful, while protecting the green belt, spreading the joy and fulfilment of home ownership, building the next generation of Conservative voters and keeping Labour out of power.”
Mr Sunak is trailing Liz Truss in the Tory leadership race, according to polls, as the pair head into a crucial hustings in Eastbourne on Friday night.
The gathering will represent one of his last chances to sway the views of party members before they start to receive their ballot papers next week.