Plans for thousands of new homes unveiled

Deputy Prime Minister John Prescott today announced the release of more public sector land for cheap new homes, as ministers predicted housebuilding was set to hit a 15-year high.

Deputy Prime Minister John Prescott today announced the release of more public sector land for cheap new homes, as ministers predicted housebuilding was set to hit a 15-year high.

Mr Prescott said that three former National Health Service sites were being made available to provide land for nearly 400 new homes - many for first-time buyers.

The sites, in Newport Pagnell, Basingstoke and Maidstone, have been allocated to the Government's Design for Manufacture competition which challenges housebuilders to design homes for a construction cost of about £60,000.

Further sites, with the names of the 33 bidders who will go through to the next round of the competition, will be announced next week.

The Government's regeneration agency, English Partnerships, has already bought up almost 100 former NHS sites and is looking at another 700 possible sites, including surplus Ministry of Defence land.

Mr Prescott, visiting the Isokon building in Camden, north London, where key public sector workers have been able to buy a stake in their flats through a shared-ownership scheme, said there was a need for more affordable housing.

"We need to build more for our money," he said. "We want to ensure decent housing for everyone, whether they own or rent. We remain committed to the provision of decent housing at an affordable rent."

Accompanying Mr Prescott, Chancellor Gordon Brown said that Government measures, including the extension of shared ownership schemes and cutting the stamp duty threshold, should see the provision of 200,000 new homes this year.

"This is a bold housing initiative that is going to give hope to people wanting to buy their homes for the first time, making it possible for people to afford something they would not otherwise be able to afford," he said.

"It is combined with increasing the supply of land, cutting the costs of construction and speeding up planning permission so more houses should be available and indeed this year for the first time in 15 years we believe that 200,000 more houses should be available."

However Martin Weale, director of the National Institute of Economic and Social Research, warned that shared ownership schemes would ultimately benefit wealthy property speculators rather than the people that they were supposed to help.

"It means house prices will be higher than they would be otherwise. The people who are likely to benefit from it in the end aren't those who are buying houses, but people who already own them," he told the BBC Radio 4 Today programme.

"The message coming from this is that the Government wants to maintain the liquidity of the housing market by helping first-time buyers back in, and that of course makes housing something of a one-way bet for the sort of person who already owns £1 million worth of houses and is thinking of buying more on credit."