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One of the biggest housebuilders active in London has said that a change in government policy is needed if homes are to become more affordable to owner occupiers.
Speaking at Bisnow’s Future of West London event, Ballymore Group Managing Director John Mulryan said that in spite of protestations from government that they want to increase the affordability of housing, the current policy and taxation regime drives developers to target high-value homes.
“At the moment, all the focus of policymakers is not on private homes and owner occupiers,” Mulryan said. “We have a system where developers are required to provide a certain level of subsidised affordable housing or social housing, as well as paying into an infrastructure levy. In order to be able to provide that, you have to sell the remaining private units at as high a price as possible, and that involves selling to high net worth investors around the world.
“By definition, affordable housing is housing that people can afford. If you look at our schemes in Ireland, 99% of those are bought by owner occupiers. In London, that figure averages at about 20%.”
Mulryan said a form of quota would have to be introduced to change this situation.
“I think one of the only policy measures you could implement which would tip that balance back in favour of owner occupiers would be some sort of minimum in the amount of homes in a scheme sold to owner occupiers,” he said. “To achieve this we would need to provide more affordable private housing. But that would mean that land prices would have to drop and it will also impact the amount of social housing you could provide for a viable project.”
Mulryan was speaking at an event hosted at Ballymore’s Brentford Project in West London, an 11-acre site between the river and the high street in Brentford which will deliver more than 800 new homes and 140K SF of new retail, as well as cultural and leisure and commercial opportunities.
Mulryan said the company is looking to create a new high street for the area, which would involve bringing in a blend of local and national retailers to the district.
He said that entailed abandoning the notion that retailers need to offer a long, positive credit history, and that Ballymore had to use its judgement on the kind of retailers and restaurateurs that would appeal to the existing local population and the people that would move to the area as a result of the scheme.
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