Public investment in new homes must double to avoid a slump, a former housing minister has claimed.
John Healey, Labour’s leading housing campaigner, said the government should also make a commitment to freeze the Housing and Planning Act.
In a keynote speech at the Chartered Institute of Public Finance and Accountancy conference, he called for an upfront funding commitment of around £3bn a year.
He claimed this would be double the current average annual investment pledged in this Parliament of just under £1.5bn, and could help councils, housing associations and private developers build an extra 100,000 homes over four years creating thousands of jobs.
Healey also called for the lifting the artificial borrowing caps on councils, allowing them the freedom to borrow to build within strict prudential borrowing rules.
He argued this could free up to a further £7bn of investment and build 60,000 homes over five years. This could pay for itself in lower housing benefit savings.
Healey said: “The emerging economic shock of the referendum result means government must act. The impact on housing is already serious with billions knocked off the value of housing developers, property funds frozen, and new developments put on hold. Without decisive action, the shock will become a downturn.
“Ministers should also now freeze the implementation of the extreme and unbalanced Housing and Planning Act. The last thing the fragile housing market needs is now is further upheaval from Whitehall.”