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Olympic Games 2012: Housing

Volume 694: debated on Thursday 26 July 2007

asked Her Majesty’s Government:

How many commonholds have been registered under the Commonhold and Leasehold Reform Act 2002; and what encouragement they are giving to developers to build residential commonhold properties on the Olympic site.

My Lords, on 19 July this year there were 13 registered commonholds, comprising 129 units. The London Development Agency is working with key stakeholders to develop proposals for the development of the site after the 2012 Games. It is too early to say how property and land ownership on the site will be structured.

My Lords, I thank the Minister for that reply, which is still very disappointing, as in November 2005 there were six commonholds, which the Government admitted themselves was an abysmal number, and it was part of the Labour Party manifesto at the 2005 general election. It gives people a better way in which to own their homes.

In answer to my Question in November I was told:

“The Government are absolutely committed to commonhold. We shall investigate why progress is so slow and report back to the House early in the new year”.—[Official Report, 22/11/05; col. 1496.]

I am not aware of any report back. Can the Minister confirm whether we ever got a report back, or has this just been lying idle since 2005?

My Lords, the noble Baroness is right in suggesting that progress has been disappointing. We have not yet brought a report back to Parliament. What has been decided is that, because of the disappointing progress, a consultation should take place later in the year with the key parties interested in commonhold to see what we can do to improve take-up of what I agree with her is a very desirable option.

My Lords, yesterday was a most historic day for the Olympics. The London Development Agency handed over the land to the Olympic Delivery Authority on time and on budget. Will my noble friend congratulate the Mayor and the London Development Agency on the wonderful work that has been done? I declare an interest as a member of the LDA and chair of the Olympic Delivery Committee responsible for the acquisition.

My Lords, I am very happy to endorse what my noble friend said. The House may be interested to hear about the use of the land post-Olympics. The LDA intends that 9,000 new homes should be developed, many for key workers, and that at least 30 per cent should be affordable for low-paid workers.

My Lords, I fear that nobody in this House will recall that some six years ago my maiden speech extolled the virtues of commonhold. It is indeed very sad that this has proved a complete damp squib. Does the Minister agree that developers and house builders do not offer this form of tenure to people who buy the flats and apartments that they build because they can charge a ground rent if they sell a lease which they cannot do if they sell it on a much better commonhold basis? Does he further agree that as regards the Olympic site, and indeed all sites where either public money or public land is involved, the Government should help to show the way and really get commonhold to take off?

My Lords, I assure the noble Lord that his maiden speech still echoes round the corridors of the Ministry of Justice. He is absolutely right: that is one of the reasons developers seem not to be keen to move into this area although there could be counterbalances in that commonhold could be very much more attractive to buyers of property. That could be reflected in the premiums. It is clear that we need to talk much more closely with developers and other companies to encourage them to think of this as a positive option. I take the noble Lord’s point about the Olympics. I shall ensure that my officials pass this to the relevant people in the LDA, but it must be for them to make those decisions.

My Lords, if the noble Lord wants to make commonhold more attractive, why do the Government not use incentives? If they abolished stamp duty on these units, they would sell like hot cakes.

My Lords, noble Lords will know that it is somewhat above my pay station to talk about tax matters in your Lordships' House. However, one of the areas we will look at as part of the consultation is whether more incentives can be identified to encourage the development of the definitely much more desirable concept of commonhold.