Government will spur UK house building - comment by Dr Gheorghe MultescuAn LSBU academic comments on the Government's Spending Review which sets out plans to increase home building in the United Kingdom
Dr Gheorghe Multescu, Director of London Institute for Real Estate in London South Bank University (LSBU)'s School of The Built Environment and Architecture, has responded to the Government's Spending Review and its announcement that it will double the UK's housing budget to £2bn a year, delivering 400,000 new affordable homes.
Dr Multescu comments: "The government’s approach is based on the principle that encouraging homeownership through government subsidies and shared ownership schemes is the answer to the current housing crisis.
"The subsidies are designed to prop up the market so that it maintains a high volume of transactions and mortgage lending as a trigger for the private house builders to deliver the 400,000 new affordable homes.
"However, injecting tax payers’ money into the pockets of private house builders and private owners of starter homes, without a clear mechanism of recovering such funds, should be strongly questioned by the public. A minority of new buyers are actually provided with a cash gift, to the detriment of other tax payers. Equally, private builders are rewarded with subsidies in order to round up their already nice profits.
"This scheme does not seem to consider local authorities to be a worthy partner in joint housing schemes and ignores the fact that the current housing affordability crisis draws its origins from an imbalanced market-driven housing delivery approach.”
Dr Multescu spoke recently at the MIPIM UK property fair and has also written about the affordable housing crisis for Global Real Estate Experts.
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