Balls is estimating that the sale will raise £3bn and proposes to spend £2.5bn to build 100,000 affordable homes,
Err, he\’s suggesting that an \”affordable home\” costs £25,000 to build.
Which is bollocks quite frankly, total Balls.
Construction cost, leaving aside entirely the cost of the underlying land or the value of the planning permission is in the £110-£125,000 range for a simple 3 bedder house. Costs do decline for stack a prole worker flats, this is true.
Oh, and the land value for such a 3 bedder, with planning permission, is around £100,000 and up. For any region of the country where there is actually someone looking for a house that is.
What\’s really very annoying indeed is that, well, if there is some miracle new technology which allows a house to be built for £25k then we don\’t actually need a tax subsidy at all. Don\’t need any revenue to be spent, not one single penny. Just zone the land, issue the planning permission and offer it to a pension fund or two. They would be delighted to (heck, selling the idea to them would be the easiest sale ever, I\’d take on the job, for a commission, like a shot) run with it. Hire a builder, whack up the units and rent them out. You\’d get hundreds and hundreds of thousands built under such a scheme.
So what is it that Balls is actually saying for even he doesn\’t normally lie like this.