In November 2017, Daniel Bentley published his report ‘The land question’, on behalf of independent Think Tank Civitas. This explores the key drivers behind why we are not building more homes. The report argues that the root cause of the housing crisis lies in land. It underlines that landowners have been making extraordinary profits for many years due to the rising value of land. And explains how land-banking, drip-feeding and revising down of affordable housing provision have all been contributing factors to this problem, but that simply releasing more land is not enough. The report outlines how this is a historical problem and that the key to reform lies in revisiting the Land Compensation Act of 1961. The latter enshrines the right of landowners in law to be reimbursed for the prospective use of a site in the event of a Compulsory Purchase Order (CPO). The right to this ‘hope value’ means public authorities are powerless to enforce development priorities for the community. This was not always case- New Towns and other developments created before the 1961 Act enabled land for new homes to be acquired at agricultural or industrial use values which successfully doused speculation and withholding of land.
To achieve a decisive breakthrough in the housing crisis the report recommends that the law needs to be amended to enable land to be released for housing at cheaper prices. This would be achieved by removing landowner’s unwarranted entitlement to residential values for sites that have not yet been granted planning permission. It’s argued that this would facilitate quicker and more affordable development, and would mean that they would no longer gain an ‘unearned increment’, generated not by the owner of the land but by the labour and the investments of the community.
The key recommendations in the report are easy to agree within principle. Yet to succeed they do rely on public bodies to use and resource any additional powers. Previously LAs have proved themselves risk averse to similar approaches and with good reason too - considering slashing of funding and the associated lack of capacity this has entailed. In addition, it is also assumed that given these powers, the public sector will start building en-masse again. It would certainly be easier but is it a given? While government promises a “new generation of council housing” it is unclear what this means and whether it will happen.
The land question is certainly not a concise report. In fact, it’s over 90 pages long. It could therefore benefit from being more succinct, or at least the inclusion of an executive summary would ensure more people could grasp the key points being made. Despite this, it remains highly accessible. The report makes compelling and well-articulated arguments for the need to review how we approach land. He makes complex economic concepts fathomable and has transformed what has historically been a dry topic into something interesting.
The approach to the report has been to conduct an exhaustive and worthwhile review of secondary data and research. This approach has enabled him to present a useful and detailed overview of policy and trends in practice over time. The report is excellently referenced, well-balanced and makes great use of existing literature (particularly drawing upon both academic, historical, international and wider research). The only down side is that perhaps his approach could have therefore been strengthened through primary data collection and analysis.
Overall, this report does much to bring together existing evidence to positively influence policy makers to tackle undersupply of affordable housing through reform of land compensation rules, even if the recommendations are not necessarily new or ground breaking.