Friday, June 11, 2010
Nimbyism to be penalised
Nimby housing protesters face higher council tax
The Government is planning an overhaul of the council tax to fund the building of new homes for first-time buyers and families. In future, Nimbys who object to new developments will pay the price of their opposition in higher council tax bills. Grant Shapps, the Housing Minister, has told The Times that he will reward local authorities that give planning approval to housing developments by matching the council tax revenue collected from these homes. The money will continue for six years, with extra provided for affordable homes for first-time buyers.
Posted by wanderinman @ 10:17 PM (1640 views)
14 thoughts on “Nimbyism to be penalised”
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Normski says:
That’s more like it.
It’ll take a while to sink in but hitting a NIMBY where it hurts must have more of an impact that the previous “targets” ruling.
Up till this takes off it is easy for anyone to object to any sort of development. I guess it still will be easy to object. But if your council tax is 20% higher than your neighbour, and it transpires that it’s because of minimal development in your area, then cogs will start to turn.
As long as the developers leave my area alone, then cushty.
paul says:
How about going a little further and banning NIMBYism around the building of modern factories that could employ young people to give them salaries to be able to afford to buy these houses instead of MPs pandering to “angry residents” shouting down “evil industrialists” and muttering on about them being a “blight to the landscape” when all they really care about is the value of their home going down and young people looking for jobs can go apply to MacDonalds etc.
Going too far?
Mikelivingstone says:
I’d say this is a good policy if local Councils actually decide to use their brains.
A lot of the issue with councillors unfortunately is that they bow to the pressure of the NIMBY boomers and to be honest most of them are NIMBYs themselves. There was a cheer from many councillors when the regional spacial strategies were abolished along with their housing targets. However, this new policy effectively says build houses to get additional grant. Frankly I think this is a good idea. Some areas will want to grow and develop, others can just become decaying relics full of decaying boomers.
mark wadsworth says:
Well it’s a teeny tiny step in the right direction, but prone to corruption and administratively unworkable.
What he’s trying to do here is replicate one of the many benefits of Land Value Tax, which is to counter-act NIMBYism. If people refuse to allow any new development, then that pushes up house prices and so the NIMBYs end up with higher tax bills. In the absence of any such tax, we will always have NIMBYism, as it is a one-way bet. There is no market forces that makes it an each-way bet.
maihem says:
@Mark Wadsworth
LVT is also corruptible because it requires some capable and honest authority to decide what the value of a piece of land is. It’s completely unaustrian. There needs to be way to take rent by the community like the open lease system I suggested before.
Sarah says:
” It’s completely unaustrian.”
Yeah great, let’s have lots of really big bubbles the austrian way.
cyril says:
well worth it if you are a NIMBY. The revenue from new houses would be about 1% of the total at most
mark wadsworth says:
Maihem, working out what the tax ‘should be’ is dead easy and it it will be immediately obvious if the tax is ‘too high’ or ‘too low’.
If the tax is ‘just right’ then what we will observe is that physically similar buildings will sell for similar amounts wherever they are in the UK, in other words their rebuild cost. If they are selling for more than that in a particular area, then the tax gets nudged up a bit next year in that area, and vice versa.
This requires very little info above and beyond what HMLR already record (i.e. it requires an estimate of rebuild costs)
wanderinman says:
After scrapping HIPs and possibly CGT raises (shall see what’s in the budget though), this looks like another incentive from the government to increase housing supply over the next few years. Shapps said, “The incentives will be available for housing schemes that receive planning permission today.”
MW, why should it be “administratively unworkable”?
I seem to recall a contributor to this newsblog mentioning something very similar to this plan within another thread in recent weeks. Can’t find where it is here though.
mark wadsworth says:
it will be unworkable because the figures that Shapps mentions are entirely arbitrary so will of themselves lead to further distortions (cash strapped councils will allow stuff to be built even if it is not needed) and the NIMBYs will still dig their heels in where there is a need for more housing. In any even,
I get The Morbidly Obese One at DCLG will have a thing or two to say about this – if Shapps thinks he can persuade a Tory government to cut grants to Tory-run councils then he has another think coming.
My full response is over here.
Afcone says:
This won’t work, as the effect on Council Tax will be small. Quick back-of-a-fag packet calculation:
Say a council planned to build enough homes to increase housing stock in its boundaries by 10% (which would be massive amount). At best it would increase its Council Tax revenues by 10%. In reality this would be less, because the aim to increase homes for first time buyers, whose homes will likely be smaller and lower than the average banding for the area. And the council will have to provide services for the new homes. Even if we assume a council’s fixed costs is 50% (which is likely to be too high an estimate), then the effect of residents rejecting all proposed house building in an area will be to increase their council tax by an absolute maximum of 5% – and only for the six year period in which this scheme applies. In practice, the cost to residents of rejecting planning applications will be a lot less.
A lot of home owners will happily swallow a 3-5% increase in their council tax (maybe £50 a year) if it means keeping their own house values high. This scheme will do nothing.
Mrmx9 says:
I am not sure how workable this all is in practice. No new money is being provided in reality to councils – the funds will just be reallocated from areas seeing more home building to those seeing less.
Its district councils that approve house building – but their element of the council tax is only about 20%. How many of them are going to risk the wrath of locals to get £150 per house extra in council tax revenue for six years.
It just doesn’t add up!
clockslinger says:
Yup, councils will see this as a major source of potential revenue, particularly given other funding will be reduced…local housing need or not. I certainly dread to think what the consequences in areas like rural North Yorkshire will be. Still, as it is a Tory idea, with Tory local authorities, the rabidly Tory majority will think it a great idea despite the fact the problem of a shortage of affordable properties either doesn’t exist (in some areas) or (more often) is a consequence of wealthy individuals owning many, many otherwise available properties with no tax disincentive to deter this kind of idle “investing”. As for the CGT smokescreen…what is it…two years since the 18% band was introduced? Yet a return to the status quo ante is certainly the fourth horseman of the financial apocalypse if you listen to above mentioned multiple property owners braying over their fourth bottle of Margeaux in the local pub.
maihem says:
@mark wadsworth, so are you then setting a regional boundary and for each region tax by the square meterage? That’s just a population redistribution scheme and doesn’t move the right to collect tax (aka rent) from the land owner to the people (the only rightful purpose of any land reform). It also leaves the corruptibility of planning systems and nimby-ism, and open-lease system could remove far more corruptibility (if given further thought – the basic system I talked about will need further work, I’m sure).