Housebuilder: Planning and tax rules are stopping us building London homes
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The boss of housebuilder Berkeley has warned that Britain’s planning, tax and red tape regime have created an “increasingly uncertain, unpredictable and burdensome” environment for new projects.
Berkeley Group chief executive Rob Perrins used a market update this morning to warn that the three-pronged attack on building would drive investment away from urban areas.
“It will lead to lower productivity, fewer jobs being created and net zero being harder to achieve, as the efficient re-use of land in urban settings to deliver, well-connected, nature-rich new communities, near existing infrastructure is the most sustainable form of development,” he said.
Berkeley built 1,785 homes in the first half of the year, compared to 2080 in the same period the year before.
It is delivering 10 per cent of all of London’s new private and affordable homes but indicated it would kick off more large-scale projects if the regulatory environment was more friendly.
“We are ready and able to deploy capital into new opportunities once the market and regulatory cycles inflect and returns can be earned commensurate with the level of upfront investment and operational risk we undertake,” Perrins said.
“While the need is clear, the challenges to new development are complex, but we are encouraged by the level of engagement that Berkeley and other urban regeneration specialists are now receiving to address the specific barriers to brownfield development.,” Perrins added.
The firm saw profit before tax creep up just shy of 5 per cent year on year to £298m over the first six months of the year, with the net cash pile now sitting at £422m.
The firm did however say that net reservations were down around a third compared to previous cycles, which Berkeley put down to macro-economic headwinds and interest rate hikes.
“We anticipate the sales market will remain subdued before inflecting in its normal cyclical manner once there is greater confidence in a downward trajectory for interest rates and economic stability returns.