U.K. Said to Press for More House Building as Prices Soar

U.K. Prime Minister David Cameron’s administration plans to accelerate the building of cheap homes, addressing a dip that will probably be reported just before next year’s election, said a government official familiar with the plans.

Housing is emerging as a key theme of the May 2015 election, with opposition Labour Party leader Ed Miliband arguing that Cameron’s Conservative-led government has failed to tackle rising living costs. The challenge was underlined by a Nationwide Building Society report today showing London home prices jumped the most in 27 years in the second quarter.

While official projections show total housing completions and private housing starts will rise this year, that may change next year as a government-sponsored program to build cheaper houses for rent and sale ends in April 2015. Since the spending was front-loaded, statistics due before May next year will probably show a fall in total housing starts. The BBC reported yesterday that housing starts may be down about 4 percent.

“Housing starts are now at their highest since 2007 but we’re going further, building on the success of schemes like ‘Help to Buy’ to get Britain building and investing billions of pounds in new affordable homes,” Housing Minister Kris Hopkins said in an emailed statement today. “I’ll be bringing pressure to bear on the small number of slow-coach councils that need to raise their game to meet what they have signed up to do and deliver the new homes their communities rightly expect.”

Ministers will ensure the 1.7 billion-pound ($2.3 billion) Affordable Homes Program 2015-18 can start building 165,000 properties as soon as funding is released in April 2015, according to the government official, who asked not to be named because the plans haven’t yet been announced. Measures planned also include “naming and shaming” local authorities which haven’t spent money allocated to them for cheap homes.

Ministers at the Department for Communities and Local Government are also looking at removing delays between projects gaining planning permission and starting work, according to the official.

To contact the reporter on this story: Robert Hutton in London at rhutton1@bloomberg.net

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net Thomas Penny

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