The boss of one of Britain’s biggest housebuilders, who is heading a Labour-backed review into the country’s housing crisis, has warned he is concerned about the rapid rise in house prices.
Pete Redfern, chief executive of Taylor Wimpey, said the government should consider “tapering off” its Help to Buy scheme, which is designed to help first-time buyers get on the housing ladder. “We should not want an environment of rampant house price growth,” he said.
Redfern was speaking at the launch of the Redfern Review, commissioned by John Healey, Labour’s shadow housing minister, to investigate a slump in home ownership in Britain. The number of young working-class households that own homes has declined by a fifth since David Cameron became prime minister.
Figures from the Halifax released on Thursday show that annual house price inflation has hit 9.7%, and Redfern expressed his concern at the speed of the growth.
He said: “If that continues for two, three, four years and beyond, it is an issue. We are now in a borderline place. We have to keep this under watch.”
The Redfern Review will look at how to increase home ownership in a way that is “sustainable” for individuals and the market, the Taylor Wimpey boss said.
The review is not a policy document for Labour and Redfern said the party could “choose not to listen to what we say”. Redfern will lead the review panel alongside Terrie Alafat, the head of the Chartered Institute of Housing, Andy Gray, the former head of mortgage lending at Barclays, Ian Mulheirn, director of consulting at Oxford Economics, and Dame Kate Barker, a former member of the Bank of England’s monetary policy committee and who produced her own review of the housing market a decade ago.
However, Redfern denied that his position as chief executive of Taylor Wimpey could mean that the role of housebuilders in Britain’s housing crisis is not properly explored.
“Ask me that question at the end,” Redfern said. “I have come into this to ask difficult questions.”
The Guardian revealed that Britain’s biggest nine housebuilders possess enough land to build more than 600,000 new homes and are sitting on £1bn of cash.
However, Redfern insisted that housebuilders “don’t have a vested interest” to sit on land. He said the companies were capable of working with the government to solve the country’s housing shortage and there is not a conflict of interest between their shareholders and the country.
“If you take anything like a medium to long-term view, those conflicts are not significant,” he said. “We should not want an environment of rampant house price growth. Both sides should want a sensible, regulated, but not over-regulated, market.”
However, Redfern urged the government not to set strict targets for the number of new homes that should be built in a year.
“What really matters is the total or average over the next 10 to 15 years,” he said,
Michael Tighe, spokesman at Shelter, the housing charity, said the prospect of owning a home in London was a “pipe dream” for young people.
He said: “Too many Londoners are afraid they’ll never have a permanent place to call home. The next Mayor of London will have real powers on housing – they’ll control the budget for affordable homes, they can submit plans for developments, and make a real difference to millions of Londoners.
“It’s time to see some specific, detailed plans that tell us how we go from what is a very real crisis, to a situation where a home of your own in London goes from pipe dream to possibility.”
Jan Crosby, head of housing at accountancy firm KPMG, welcomed the launch of the Redfern Review. She said: “Housing has become an increasing issue across the country in the past few years, with prices marching ever upwards and a shortage of new homes being built.
“Our own research shows that the average first-time buyer cannot afford the average first-time home, a situation that simply isn’t right.”
