Public Finance, Feb.17th-23rd 2006, p.22-23
The government is committed to increasing the number of new homes built annually from 150,000 to 200,000 by 2016. To pay for the necessary development of the local infrastructure to support the new housing, government has brought forward plans for a new nationally collected tax, the planning gain supplement. This will be paid by developers and will be based on the increase in land values generated by the development plans. Its introduction is being opposed by both local councils and builders. The builders fear that the tax will be too high, and the councils suspect that they will not get enough of the money back from central government to pay for the infrastructure.
Axis, Jan./Feb. 2006, p.18
Real estate investment trusts (REIT) are set for launch following the Chancellor’s December 2005 pre-budget speech and report. The idea behind the trusts is to attract investors with the promise of steady returns and use the cash invested to build a portfolio of properties which could include affordable housing for rent. However, there is doubt that REITs will do much to increase the supply of social housing because of the perception that such an investment would be risky and not very lucrative.