Public Land Value Capture: A new model for housing development in Scotland

Stephen Richard — Wed, 18 Aug 2021 17:39:39 +0000

Primary Author or Creator

Common Weal

Stephen Richard Wed, 08/18/2021 - 18:39

Alternative Published Date

Feburary 2018

Category

Land

Type of Resource

Policy Paper

Fast Facts

This report outlines the case for public land value capture – the process by which councils, not those selling land, can benefit from the increase in land value due to changing use (such as planning permission for housing) or can reduce house prices by not passing that uplifted cost on to renters and buyers of the houses built on such land. This briefing is based on Common Weal’s submission to the Planning Bill consultation in response to question, on alternative ways to finance infrastructure provision. It is part of a series of briefings by Common Weal on housing, communities and places.

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― Public authorities should have the legal means to purchase land at existing use value, so that the uplift in land value from planning permission for development of the land is captured for the public good. The financial consequence of this public land value capture policy will be increased funding for housing development without any upfront cost, as the public authority could borrow against the future uplift in land value to finance the development of the site. Plots of land can then either be developed directly by the local authority, or sold to developers at cost price plus infrastructure costs. This approach would be significantly cheaper than what developers would pay for development if their costs involve purchasing land at market value.

― Public land value capture is not new. The UK Government’s 1947 Town & Country Planning Act introduced planning permission and with it the provision for public authorities to compulsory purchase land at existing use value. Public land value capture simply seeks to return Scotland to a situation where the public gains the increase in value from public investment in the development of the land. This public investment would also create better market conditions, as instead of the private sector competing over control of the land market it would compete over the quality of housebuilding developments, creating a more diversified market for housing supply and tenure type.

Resource Address (URL)

https://commonweal.scot/wp-content/uploads/2018/02/Public-Land-Value-Capture.pdf

Keywords

Local Planning powers

Public land value

public investment

House building

Language English

Housekeeping Scotland: Discussion paper outlining a new agenda for housing

Stephen Richard — Wed, 18 Aug 2021 17:21:35 +0000

Housekeeping Scotland: Discussion paper outlining a new agenda for housing

Primary Author or Creator

Malcolm Fraser

Stephen Richard Wed, 08/18/2021 - 18:21

Additional Author(s) / Creators

Common Weal

Alternative Published Date

October 2016

Category

House ownership

Social housing

Type of Resource

Policy Paper

Fast Facts

The United Kingdom’s housing policies have been ideologically-driven, and have led to the current crisis of strangled investment, under-provision and a general flow of power and money from civic society to the wealthy. UK housing has suffered greatly from its politicians’ fixation with a single form of home and tenure, the mortgage-backed and privately-owned home. But it is clear that not everyone is going to get a mortgage; and it is also clear that the ideological pursuit of this helped poison, and nearly bring down, the world economy, as well as being a key contributor to our current housing crisis. While Scotland has shown some appetite for broadening our housing horizons it needs to set out a clear agenda for achieving a diverse and sustainable market, that suits all incomes and interests while providing the shelter that is a fundamental right for all, and this brief paper suggests the three overarching principles we should consider, and key areas of change which, taken together, would deliver them.

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KEY POINTS

― Principle 1: Sustainability: the Built Environment as Precious Resource, and the Need for Structural Change to Reflect this. A better strategy is needed around returning vacant homes to use and VAT must be changed to make it more advantageous to repair and rebuild houses than it is to build new stock.. Land and Planning regulations can be changed to reduce “land banking” and to help regenerate town centres. Compulsory Purchase Orders and taxes such as a Land Value Tax or Derelict Land Tax can correct land ownership inequalities and allow land to be used more effectively.

― Principle 2: What We Build, and How. Public Rental: Scottish National Investment Bank and Company based on a re-engineered Scottish Futures Trust. Self-Build: models set out to encourage Local Authorities to bring land and cooperative groups together. The Private Rented Sector (PRS): ‘build to rent’ – long term investment. Infrastructure Funding: community-infrastructure projects. Land Assembly: Local Authorities given power to acquire land.

― Principle 3: Leadership. The Scottish Government needs to create a central Housing Unit, which can assist Local Authorities, Registered Social Landlords, Volume Housebuilders and house buyers and renters to deliver the programme we need.

Resource Address (URL)

https://commonweal.scot/wp-content/uploads/2016/10/Housekeeping-Scotland.pdf

Keywords

Housing

Land Value Tax

Derelict Land Tax

Local Planning powers

Rental Housing

Language English