Pension funds could finance new homes, report suggests

 
Rooftops of homes in Eastbourne The report suggests setting up a central fund of council pension fund assets

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A possible 100,000 to 300,000 homes could be built in the UK every year without using any government money, a study has claimed.

The Future Homes Commission, set up by the Royal Institute of British Architects, said council pension funds could be used to reach the target.

Some of the assets in local government pension schemes could be pooled to provide a £10bn housing fund, it said.

Housing Minister Mark Prisk said the ideas would be considered carefully.

He described the proposals as innovative and interesting.

'No better time'

The report said a housing revolution that would lead to economic growth and create tens of thousands of jobs was possible without increasing government debt.

Commission chairman Sir John Banham said local councils should lead new development.

"There is no better time to tackle the UK housing crisis," he said.

"After a year-long national inquiry, the Future Homes Commission has concluded a housing revolution is entirely possible and will lead economic growth.

He added: "We need to increase massively the number of quality homes being built for many years to come, but also to develop communities which enhance the quality of life for both new residents and those living in existing communities nearby. All this has to, and can, happen without any additional government funding.

"We strongly believe that local government can become the leader of new development once again, by using their assets and powers to create the type of mature, sustainable, mixed tenure communities that Britain needs and that institutional and international investors want to invest in."

Borrowing ability

The Local Housing Development Fund would be used to build quality homes that could be sold in the future to replenish the pot.

The study said the UK needed a threefold increase in the number of new homes to help end the "blight" of poor housing.

Councils have responded positively to the report but said the government must also ease restrictions on the ability of local authorities to borrow for house building.

The president of the Royal Institute of British Architects , Angela Brady, said the commission's recommendations "provide an excellent starting point for delivering a radically improved housing market".

 

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  • rate this
    +1

    Comment number 455.

    416.AndyC555
    But everyone is selfishly pushing the problem on to our children and grandchildren. Boy, are they going to hate us

    =>That's how life is. My grandparents hated my great grandparents for WW2. My parents hate my great grandparents for the break up of the colonies leading to mass immigration; I hate my parents for being two young to bear me in time for the 1960s. etc etc

  • rate this
    -1

    Comment number 454.

    Better than putting it into a Icelandic bank.

  • rate this
    -5

    Comment number 453.

    The country is skint, so any source of finance for big ticket items will look attractive to the govt (all parties).

    On pensions, our national debt does not include the liability of pensions for civil service, armed forces, teachers, nhs, police and firefighters. Their pensions get paid from general revenue raised by the govt from taxation.

  • rate this
    +2

    Comment number 452.

    @443.Good Egg

    No. Prices are too high because interest rates are too low! Low interest rates naturally occur when people have lots of savings. But people have no savings so the BoE price fixes the rates to near Zero 0.25% to "stimulate construction jobs". This artificially allows people to borrow more than otherwise, allowing them to bid higher prices

    It's a classic housing bubble ala USA.

  • rate this
    -5

    Comment number 451.

    "usedtobeBill
    AndyC555
    But everyone is selfishly pushing the problem on to our children and grandchildren. Boy, are they going to hate us.
    --
    They can blame me. I don't care. As a childless, tax paying worker I've been paying for your kids for years."

    I doubt it. My only child was born privately and privately educated.

    I know I've paid enough tax to cover anything else.

  • rate this
    0

    Comment number 450.

    What would be the return on investment (minus costs)? Then we can see if this is financially viable?

    Not sure I have confidence in the calculation or measurement of this though?

  • rate this
    +2

    Comment number 449.

    I paid into my local government pension fund for the best part of 30 years - the Government has no right to help itself to my savings. If it's such a great idea, why not raid the MP's pension fund?

  • rate this
    +1

    Comment number 448.

    #437. David H

    If it was just your money (which it isn't) and you expected absolutely no help whatsoever if your 'plan' failed and we know exactly how long you are going to live then fine.

    440. adamc1979
    Good point :)

  • rate this
    -4

    Comment number 447.

    49. FishFingers

    Less people? What's your solution? Shoot every tenth person? Or perhaps we could be more selective in how we make our lebensraum: the travellers could go first, then the mentally ill, then the jews.

    Personally I think we should start with daily mail readers. We could stop after that as there wouldn't be any more problems.

  • rate this
    +4

    Comment number 446.

    in other words lets get tax payers to pay for it sell to private companies and they make money out of it. . . . erm does this ring a bell it seems to repeat its self time and time again: (council houses, public trainsport, gas and electric, phone lines i could go on ) all made and paid for by us and sold off and now whos making the money???well the tax payers are not benefitting from it.,

  • rate this
    -4

    Comment number 445.

    "ish
    Public Sector workers 'actually' pay tax"

    I know that. And their taxes go on the same day to day things that everyone else's taxes go on.

    What's you point?

    I've given facts, figures, links to reports which show the current pension system needs massive overhaul

    All you've done is the equivilent of running in circles with your fingers in your ears blathering "I'M NOT LISTENING"

  • rate this
    -2

    Comment number 444.

    And the money they borrow how they gonna replace it, were in debt as it is??Yes they probably do pay tax and probably do deserve a pension but what have they actually done for us as a nation??

  • rate this
    +1

    Comment number 443.

    @433.Bastiat

    "If there's less houses being built today by private industry there's a reason for that, there's not enough demand. If there was, private enterprise would do it! It's simple stuff guys".

    You ignore the fact that property purchase and rental prices are high (in part) because demand is greater than supply.

  • rate this
    +4

    Comment number 442.

    416.AndyC555
    But everyone is selfishly pushing the problem on to our children and grandchildren. Boy, are they going to hate us.
    --
    They can blame me. I don't care. As a childless, tax paying worker I've been paying for your kids for years.

  • rate this
    +4

    Comment number 441.

    418. Joe
    Planning regulations are currently in force for good reason, hence for example the recent backlash against scrapping the minimum meterage for property extensions. Lets see what happens when these regulations are swept away and we're faced with another swathe of tiny, poor quality, unaffordable housing.

  • rate this
    +9

    Comment number 440.

    I'm struggling to understand why pension funds wouldn't already be invested in property if it was a financially viable option. The answer must be that it really isn't

  • rate this
    +3

    Comment number 439.

    AndyC555

    I think someone is forgetting.....Public Sector workers 'actually' pay tax, it's not a myth......and 'MOST' of them deserve the pensions they get, which has been proved sustainable, however, if you take your ear plugs out and listen to the poison the Government are stating, you WILL be against the Public Sector, and for that, I feel sorry for you.

  • rate this
    0

    Comment number 438.

    Totally agree with Fishfingers (seems a strange opening line) on 49 with the most posts and unclear why you are not an Editor's Pick as you pointed out the most valid issue surrounding this topic.

  • rate this
    +2

    Comment number 437.

    Dear Government,

    I expect to live to average life expectancy, please may I have £111,748.00
    ((Only used 20 years current state pension rate, so you are quids in ))
    I wish to invest my money in an alternative scheme.

    Yours Faithfully
    Mr Tax Payer

  • rate this
    0

    Comment number 436.

    Your home may be at risk if you do not continue your pension contributions.....

 

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