Countrywide Turns Up The Heat On Government

Is it just me or have others noticed the housing industry’s growing anger with the coalition government’s apparent inability or unwillingness to build more and kick-start the market?

Recent criticism has been deeper than the usual self-serving calls for lower stamp duty and encourage more lending (although those have been demanded, too, of course). But instead, recent comments have been wider in their scope and much more reasoned.

Look, for example, at the comments of Grenville Turner, chief executive of Countrywide (pictured).

In a report called Addressing Challenges In The UK Housing Market and drawing on data from the Council for Mortgage Lenders and Countrywide’s own Hamptons International, Turner points out that lending for house purchases is only a third of what it was five years ago.

He wants the government to encourage more lending but he goes much further and his comments are important because Countrywide is the UK's largest estate agency and property services group.

Firstly, he criticises Shapps, Pickles et al for a shortage of new homes being built. Turner does not mention the hugely-publicised programmes allegedly to encourage first time buyers, nor the reformed planning proposals hammered out at length in the public arena last year, but clearly he thinks little of them.

"More houses at the right price are needed in the right places. By the end of 2012, there will be 400,000 more households in the UK than there has been housing built. However, no comprehensive government plan of action is in place to contend with this" says the uncompromising Turner.

He also wants government to align tax receipts from the housing sector with long-term investment and incentives - in other words, he wants an end to the government using the housing sector generally and buyers and sellers in particular to subsidise other areas of the economy.

“The total tax proceeds foregone due to the current shortage of housing supply and low transaction levels is in excess of £7 billion a year. The current tax take from stamp duty is almost four times as much as the annual spend by the Homes and Communities Agency on building affordable housing" he says.

Finally, Turner calls for government action to stabilise house prices. How this can be achieved in a market economy is hard to imagine - and Turner offers no answers - but he is insistent. “House prices must be aligned with wage inflation and deflation, as excessive levels of house price volatility only benefits a small proportion of homeowners and undermines the confidence of lenders" he says.

It is a fascinating attack but is merely the most public and heavyweight of many other criticisms. Chat on Twitter and in blogs gives a hint of it, and speak off the record to developers and large estate agents and the anger and disappointment is evident.

Many of these developers and agents were, of course, financial and ‘ideas’ contributors to the Conservative party in opposition. They are now showing more than a hint of frustration that halfway through a parliament we are still seeing low house-building totals and no sign of price recovery outside central London.

As we embark on a month of national sporting celebration, will these noises carry on to make it a fractious autumn for the government once the Olympic glitter is stowed away?

If you would like to to comment on this article, click HERE to e-mail Graham. Follow PropertyJourn on Twitter